Terra company has two divisions, the retail division and the wholesale division. The following information was gathered for the two divisions for the current year Operating income for retail division-6,200,000. Op. income for wholesale division-2,700,000. Operating assets for retail division-36,200,000. Op. assets for wholesale division 16,200,000. What is the ROI. A-17.3 B-33.79 C-16.98 D-16.67
Terra company has two divisions, the retail division and the wholesale division. The following information was...
Bertie Corporation has two divisions: Retail Division and Wholesale Division. The following data are for the most recent operating period: Total Company Retail Division Wholesale Division Sales $ 486,500 $ 300,000 $ 186,500 Variable expenses $ 137,275 $ 72,000 $ 65,275 Traceable fixed expenses $ 232,400 $ 173,600 $ 58,800 The common fixed expenses of the company are $70,600. The Wholesale Division’s break-even sales is closest to: Multiple Choice $90,462 $211,192 $108,615 $357,538
Becky’s Bikes Inc. has two divisions: Retail and Service. The following information is for each division at Becky’s Bikes for the most recent fiscal year. Retail Division Service Division Income Statement Sales $1,200,000 $1,000,000 Cost of sales 550,000 400,000 Gross margin 650,000 600,000 Allocated overhead (from corporate) 210,000 180,000 Marketing expense 130,000 120,000 Administrative expense 60,000 55,000 Operating income 250,000 245,000 Income tax expense (40% rate) 100,000 98,000 Net income 150,000 147,000 Balance...
Becky’s Bikes Inc. has two divisions: Retail and Service. The following information is for each division at Becky’s Bikes for the most recent fiscal year. Retail Division Service Division Income Statement Sales $1,200,000 $1,000,000 Cost of sales 550,000 400,000 Gross margin 650,000 600,000 Allocated overhead (from corporate) 210,000 180,000 Marketing expense 130,000 120,000 Administrative expense 60,000 55,000 Operating income 250,000 245,000 Income tax expense (40% rate) 100,000 98,000 Net income 150,000 147,000 Balance Sheet Information Average operating assets $600,000 $375,000...
ABC Company operates two divisions with the following operating
information for the month of May:
Division 1: sales, $120,000; operating income, $36,000; operating
assets, $300,000.
Division 2: sales, $80,000; operating income, $40,000; operating
assets, $400,000.
ABC Company expects a minimum return of 10% should be earned from
all investments.
Required:
a. Prepare ABC Company’s ROI analysis using the DuPont
model for each division. (Round Turnover rate answers to
one decimal place.)
Division 1 Division 2 DuPont Performance Analysis: Revenues Operating...
The following information pertains to the three divisions of Yang Company: Division A Division B Division C Sales ? ? $1,345,000 Net operating income $48,000 $18,000 $82,000 Average operating assets $420,000 ? ? Return on investment ? 15% 20% Margin 0.2 0.015 ? Turnover 2.1 ? ? Target ROI 17% 14% 8% What is the turnover for Division C? a.6.670 b.3.28 c.1.500 d.0.20
The Seaton Company has two divisions the Wood Floor Division and the Tile Floor Division. Management of both divisions have been presented with the opportunity to invest in equipment that could be used to produce vinyl plank flooring. The equipment would cost $1,000,000 dollars and would incur $200,000 worth of depreciation next year. Income associated with the production of the vinyl plank flooring is estimated to be $150,000. Management of both divisions are evaluated based on their ability to improve...
Calculating ROI – Use the following information for The Regal Company to compute ROI. Net operating income ($50,000) Average operating assets ($230,000) Sales ($535,000) Operating expenses($485,000) Compute Regal's new ROI 1a. Assume that Regal's manager invests in a $30,000 piece of equipment that increases sales by $35,000, while increasing operating expenses by $15,000 and reports the following: Net operating income ($50,000) Average operating assets($230,000) Sales($535,000) Operating expenses ($485,000) Compute Regal’s new ROI. 1b. Computing Residual Income - The Retail Division...
Hammer Time Asia has three divisions China, Thailand, and Japan The following are the income statement information for each division China Thailand Japan Revenue 23,000,000 2,700,000 6,200,000 Operating exp 13,800,000 1,460,000 3,630,000 Service Dep. charges 7,300,000 510,000 1,570,000 Income from Operations 1,900,000 730,000 1,000,000 Invested Assets 17,000,000 3,000,000 9,000,000 The lucky #8. Both China and Japan have minimum acceptable rate of 8%. However, Thailand's minimum acceptable rate is double (16%). What is the ROI, Profit Margin, and Investment Turnover for each division above?
3) The Calculating Fashion Company has two operating divisions: North and South. The following information was collected from its financial statements. North South Operating income $ 15,375 S 9,160 Sales 90,100 128,445 Average operating assets 47,620 37,690 Required: The South Division has a goal to increase its ROI to 30% by the end of next year. Compute the increase (decrease) required in each of the following items in order to achieve this goal. a. Operating assets b. Total costs c....
Sapsora Company uses ROI to measure the performance of its operating divisions and to reward division managers. A summary of the annual reports from two divisions is shown as follows. The company’s weighted-average cost of capital is 10 percent. Compute the EVA for Division A and Division B. Division A Division B Total assets $ 6,140,000 $ 8,610,000 Current liabilities $ 600,000 $ 1,800,000 After-tax operating income $ 1,040,000 $ 1,167,000 ROI 24 % 13 %