Question

Provide the missing data in the following table for a distributor of martial arts products: (Round "Turnover" and "ROI" answers to 1 decimal place.) Alpha Charlie Division Bravo $ 315,000 $ 31,500 Sales $ 45,180 eBook Net operating income Average operating assets Margin Turnover Return on investment (ROI) $ 478,000 5% 5.0 9% Hint 25.0 % 18.0 %

Answer 1

1.

	Alpha	Bravo	Charlie
Sales	$2,390,000	$315,000	$502,000
($478,000 * 5)	(Given)	($45180 / 9%)
Net Operating Income	$119,500	$31,500	$45,180
($2,390,000 * 5%)	(Given)	(Given)
Average Operating Assets	$478,000	$7,875	$251,000
(Given)	($31,500 / 25%)	($45,180 /18%)
Margin	5%	10%	9%
(Given)	($315,000 / $31,500)	(Given)
Turnover	5	40	11.11
(Given)	($315,000 / $7,875)	($502,000 /$45,180)
ROI	25%	25%	18%
(119,500 / $478,000)	(Given)	(Given)
Formulas used:
Margin = Net Op Income/Sales
Turnover = Sales/Avg. Op Assets
Roi = Net Op Income/Avg Op Assets

2.

Calculate following
	Margin	Turnover	ROI
	Net operating income / Sales	Sales /Average assets	Margin * Turnover
Queensland division	$54,060 / $901,000 = 6%	$901,000 / $530,000 = 1.7 Times	6% * 1.7 = 10.20%
New south wales division	$74,400 / $2,480,000 = 3%	$2,480,000 / $620,000 = 4 Times	3% * 4 = 12%
New south wales division has better jobs