Company A. Sales $ 10.900,000 $ 6,700,000 S 0.000,000 Net operating income 238.000 Average operating assets 4,240,000 $ 6.200,000 Return on investment 19 % 14 % 24 % Minimum required rate of return: Percentage 17 % Dollar amount 340.000 Residual income (loss) 188,000
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- Sales Net operating income Average operating assets Return on investment (ROI) Minimum required rate of return: Percentage Dollar amount Residual income A Company B C $ 9,540,000 $ 7,900,000 $ 5,310,000 69 $ 445,200 $ 342,000 $ 3,180,000 $ 2,124,000 14 % 18 % % 12 % % 18 % $ 304,000 $ 106,200The following information is available on Company A: Sales Operating Income $900,000 $36,000 Shareholders' Equity Average Operating Assets $100,000 $180,000 Minimum Required Rate of Return 15% What is the fixed asset turnover for Company A? ○ 25 ○ 5 O 9 O2The following data pertain to Dakota Division's most recent year of operations. $ 17,500,000 200,000,000 65,000,000 Income Sales revenue Average invested capital Assume that the company's minimum desired rate of return on invested capital is 12 percent. Required: Compute Dakota Division's residual income for the year. Residual income 20 CE FB F6 F9 F10 Prisc Inse F11 F12 & 3 6 9. R U F
- INCOME STATEMENT Hermann Industries is forecasting the following income statement:Sales $8,000,000Operating costs excluding depr. & amort. 4,400,000EBITDA $3,600,000Depreciation & amortization 800,000EBIT $2,800,000Interest 600,000EBT $2,200,000Taxes (40%) 880,000Net income $1,320,000The CEO would like to see higher sales and a forecasted net income of $2,500,000. Assumethat operating costs (excluding depreciation and amortization) are 55% of sales and thatdepreciation and amortization and interest expenses will increase by 10%. The tax rate, whichis 40%, will remain the same. What level of sales would generate $2,500,000 in net income?3. Saved Dade Corp. has residual income of $16,60O. If operating income equals $37,000 and the minimum required rate of return is 8%, what are average invested assets? Multiple Choice $382,500 $510,000 $127,500 $255,000Use the following information to answer the questions. Company X $ 12,480,000 $ 3,120,000 $ Company Y $ 28,480,000 $ 7,120,000 512,640 8.50% Company Z $ 20,480,000 $ 5,120,000 532,480 10.40% Sales Average operating assets Net operating income Minimum required rate of return 561,600 8.00% Required: 1. Compute the return on investment (ROI) for each company using the formula stated in terms of margin and turnover. 2. Compute the residual income (loss) for each company. 3. Each company is presented with an investment opportunity that would yield a 9% rate of return. a. Assume performance is measured based on ROI. Indicate whether each company will likely accept or reject the investment opportunity. b. Assume performance is measured based on residual income. Indicate whether each company will likely accept or reject the investment opportunity. Complete this question by entering your answers in the tabs below. Req 1 Req 2 Reg ЗA Req 3B Compute the return on investment (ROI) for each company…
- Use the following information to answer the questions. Company X $ 12,480,000 $ 3,120,000 561,600 8.00% Company Y $ 28,480,000 $ 7,120,000 2$ Company Z $ 20,480,000 $ 5,120,000 532,480 Sales Average operating assets Net operating income Minimum required rate of return $ 512,640 8.50% 10.40% Required: 1. Compute the return on investment (ROI) for each company using the formula stated in terms of margin and turnover. 2. Compute the residual income (loss) for each company. 3. Each company is presented with an investment opportunity that would yield a 9% rate of return. a. Assume performance is measured based on ROI. Indicate whether each company will likely accept or reject the investment opportunity. b. Assume performance is measured based on residual income. Indicate whether each company will likely accept or reject the investment opportunity. Complete this question by entering your answers in the tabs below. Req 1 Req 2 Req ЗA Req 3B Each company is presented with an investment…Required Complete the following table Sales Operating Income Average Operating Assets Return on Investment Minimum Required Rate of return % Residual Income A 400,000 160,000 20% 15% B Company 750,000 45,000 18% 50,000 C 600,000 150,000 12% 6,000Selected data from an investment center of IROL Inc. follow:Sales $8,000,000Net book value of assets, beginning 2,500,000Net book value of assets, ending 2,600,000Net operating income 640,000Minimum rate of return 12%Required1. Calculate return on sales (ROS), asset turnover (AT), and return on investment (ROI).2. Calculate residual income (RI).
- $1,449,185 Sales $130,380 Operating Income Total Assets (investment) $544,102 Target Rate of Return (Cost of 15% Capital) What is return on investment? Input your answer to 1 decimal place. For example if you calculate.1892 enter 18.9.Q6 Selected data from Box Division's accounting records revealed the following: Sales $ 825,000 Average investment $ 440,000 Net operating income $ 66,000 Minimum rate of return (divisional cost of capital) 14% Box Division's asset turnover (AT) is calculated to be: (Round your answer to three decimal places.) Multiple Choice 4.270. 1.070. 1.875. 12.500. 1.625.IF XZX has the following data:Profit margin 2%Return on Asset 4%Sales revenues $500,000What is the company Total assets ? O a. $500,000 O b. $300,000 O c. $250,000 O d. $100,000
