The Emergency Medical Services Company has two divisions that operate independently of one another. The financial data for the year 20X5 reported the following results:
North | South | ||
---|---|---|---|
Sales | $3,720,000 | $3,220,000 | |
Operating income | 930,000 | 730,000 | |
Taxable income | 785,000 | 510,000 | |
Investment | 6,000,000 | 5,000,000 |
The company's desired
a. What are the respective return-on-investment ratios for the North and South divisions?
Round ROI to the nearest whole percentage.
North: Answer
South: Answer
b. What are the respective residual incomes of the North and South divisions?
North: Answer
South: Answer
c. Which division has the better
Return on investment: Answer
Residual Income: Answer
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