For its three investment centers, Martinez Company accumulates the following data: Sales Controllable margin Average operating assets I $1,920,000 1,392,000 4,800,000 || $3,840,000 1,996,800 7,865,000 ||| $3,840,000 3,594,240 9,600,000 The company expects the following changes for investment centers I, II, and III in the next year: investment center I to increase sales 15%, investment center II to decrease controllable fixed costs $520,000, and investment center III to decrease average operating assets $384,000. Compute the expected return on investment (ROI) for each center. Assume investment center I has a contribution margin percentage of 73%. What is the expected ROI for investment center l?

For its three investment centers, Martinez Company accumulates the following data: Sales Controllable margin Average operating assets I $1,920,000 1,392,000 4,800,000 || $3,840,000 1,996,800 7,865,000 ||| $3,840,000 3,594,240 9,600,000 The company expects the following changes for investment centers I, II, and III in the next year: investment center I to increase sales 15%, investment center II to decrease controllable fixed costs $520,000, and investment center III to decrease average operating assets $384,000. Compute the expected return on investment (ROI) for each center. Assume investment center I has a contribution margin percentage of 73%. What is the expected ROI for investment center l?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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