The following are selected data for the division for the consumer products of ABC Corp for 2019: Sales 50,000,000 Average invested capital (assets) 20,000,000 Net income 2,000,000 Cost of capital 8% What is the return on investment for the division? 2% 4% 8% 10%

Survey of Accounting (Accounting I)
8th Edition
ISBN:9781305961883
Author:Carl Warren
Publisher:Carl Warren
Chapter14: Decentralized Operations
Section: Chapter Questions
Problem 3SEQ: Division A of Kern Co. has sales of $350,000, cost of goods sold of $200,000, operating expenses of...
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  • The following are selected data for the division for the consumer products of ABC Corp for 2019:

Sales

50,000,000

Average invested capital (assets)

20,000,000

Net income

2,000,000

Cost of capital

8%

What is the return on investment for the division?

  1. 2%
  2. 4%
  3. 8%
  4. 10%
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