costs able fixed costs operating assets $420,000 252,000 73,500 525,000 ment is considering the following independent courses of action in 2023 in order to maximize the return on investr

Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter10: Evaluating Decentralized Operations
Section: Chapter Questions
Problem 13E: The condensed income statement for the Consumer Products Division of Tri-State Industries Inc. is as...
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The service division of Bramble Industries reported the following results for 2022.
Sales
Variable costs
Controllable fixed costs
Average operating assets
Management is considering the following independent courses of action in 2023 in order to maximize the return on investment for
this division.
$420,000
252,000
73,500
525,000
1.
Reduce average operating assets by $105,000, with no change in controllable margin.
2. Increase sales $84,000, with no change in the contribution margin percentage.
Compute the controllable margin and the return on investment for 2022.
Controllable margin
Return on investment for 2022
The controllable margin
Compute the controllable margin and the expected return on investment for 2023 for each proposed alternative. (Round
decimal place, e.g. 1.5%.)
The expected return on investment
Alternative 1
%
%
Alternative 2
%
Transcribed Image Text:The service division of Bramble Industries reported the following results for 2022. Sales Variable costs Controllable fixed costs Average operating assets Management is considering the following independent courses of action in 2023 in order to maximize the return on investment for this division. $420,000 252,000 73,500 525,000 1. Reduce average operating assets by $105,000, with no change in controllable margin. 2. Increase sales $84,000, with no change in the contribution margin percentage. Compute the controllable margin and the return on investment for 2022. Controllable margin Return on investment for 2022 The controllable margin Compute the controllable margin and the expected return on investment for 2023 for each proposed alternative. (Round decimal place, e.g. 1.5%.) The expected return on investment Alternative 1 % % Alternative 2 %
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