Comparative data on three companies in the same service industry are given below: Required: 1. What advantages
Question:
Comparative data on three companies in the same service industry are given below:
Required:
1. What advantages are there to breaking down the ROI computation into two separate elements, margin and turnover?
2. Fill in the missing information above, and comment on the relative performance of the three companies in as much detail as the data permit. Make specific recommendations about how to improve theROI.
Transcribed Image Text:
Company $4,000,000 $1,500,000 $ ? $560,000 $210,000 $? Sales Net operating income Average operating assets ...$2,000,000 Margin TurnoverR Return on investment (RO)? **.---- 2 $%3,000,000 3.5% 7%
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1 Breaking the ROI computation into two separate elements helps the manager to see important relationships that might remain hidden First the importan...View the full answer
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Related Book For
Managerial Accounting
ISBN: 9780073526706
12th Edition
Authors: Ray H. Garrison, Eric W. Noreen, Peter C. Brewer
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