FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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a. How many units need to be sold in order to achieve a ROI of 14%2
b. ROI in 20X2 is 14%. The management wants to increase ROI in 20x3
decides to increase the sales price 10%. However, the sales units would
decrease by 2,000 units and the operating assets would increase 100,000 in
20X3. Calculate ROI of the company in 20X3.
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Transcribed Image Text:a. How many units need to be sold in order to achieve a ROI of 14%2 b. ROI in 20X2 is 14%. The management wants to increase ROI in 20x3 decides to increase the sales price 10%. However, the sales units would decrease by 2,000 units and the operating assets would increase 100,000 in 20X3. Calculate ROI of the company in 20X3.
Exercise 2:
Company C has the following information for the year 20X2:
$50
Unit sales price
Unit variable cost
$30
Production, sales and admin fixed cost
Interest charge for the year
Operating assets at the beginning of the year
Operating assets at the end of the
Minimum return rate
$400,000
$60,000
$600,000
$800,000
10%
year
30,000 units
Maximum capacity
Requirements:
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Transcribed Image Text:Exercise 2: Company C has the following information for the year 20X2: $50 Unit sales price Unit variable cost $30 Production, sales and admin fixed cost Interest charge for the year Operating assets at the beginning of the year Operating assets at the end of the Minimum return rate $400,000 $60,000 $600,000 $800,000 10% year 30,000 units Maximum capacity Requirements:
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