Schulz GmbH, a German company, set an 18 percent target rate of return for its U.S. division for the year. The U.S. division generated $35,100,000 of annual revenue on average assets of $22,500,000. The division’s variable costs were 45 percent of sales, and fixed costs were $6,750,000. Compute the following items for the U.S. division: a. ROI ______% b. Residual income: $______ c. Profit margin ______% d. Asset turnover ______

Perusall Chalmers Corporation operates in multiple areas of the globe, and relatively large price changes are common. Presently, the company sells 105,600 units for $50 per unit. The variable production costs are $20, and fixed costs amount to $2,079,000. Production engineers have advised management that they expect unit labor costs to rise by 10 percent and unit materials costs to rise by 15 percent in the coming year. Of the $20 variable costs, 25 percent are from labor and 50 percent are from materials. Variable overhead costs are expected to increase by 20 percent. Sales prices cannot increase more than 12 percent. It is also expected that fixed costs will rise by 10 percent as a result of increased taxes and other miscellaneous fixed charges. The company wishes to maintain the same level of profit in real dollar terms. It is expected that to accomplish this objective, profits must increase by 8 percent during the year. Saved Required: a. Compute the volume in units and the dollar…

The Casket Division of Saal Corporation had average operating assets of $1,020,000 and net operating income of $205,200 in January. The company uses residual income to evaluate the performance of its divisions, with a minimum required rate of return of 14%.   Required: What was the Casket Division's residual income in January?

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Cabell Products is a division of a major corporation. Last year the division had total sales of $11,650,000, net operating income of $1,141,700, and average operating assets of $3,495,000. The company's minimum required rate of return is 11%. The division's residual income is closest to: Multiple Choice $1,141,700 $1,526,150 $757,250 $(768,900)

Searchlight, Inc. uses ROI to evaluate operations and requires the return on its operating units to be 9%.  Operating data for the Western division is shown below: Sales                                                       $1,000,000 Controllable margin                             120,000 Total average assets                             600,000 Fixed costs                                                    60,000 How much is ROI for the year? A. 20% B. 17% C. 10% D. 30%

Imagination Corporation uses residual income to evaluate the performance of its divisions. Imagination's minimum required rate of return is 10%. In April, the Commercial Products Division had average operating assets of $105,000 and net operating income of $9,700. What was the Commercial Products Division's residual income in April?   Multiple Choice   $970.   $(970).   $800.   $(800).

ABC Company has made the following projections regarding cost increases: DM will increase by 5%; DL 8%; and 6% for all other costs including fixed costs. The company has the capacity to produce 200,000 units. Consider the following various proposals made by the division managers: a) maintain the current volume and selling price; b) manufacture and sell at capacity and reduce the unit price by ₱2; c) manufacture and sell 180,000 units, increase the unit price by ₱2, and spend an extra ₱300,000 on advertising.   What is the operating income of A, B, and C