Selected operating data for two divisions of Outback Brewing, Ltd., of Australia are given below (the currency is the Australian dollar, denoted here as $):

Required:

1.         Compute the rate of return for each division using the return on investment (ROT) formula stated in terms of margin and turnover.

2.         Which divisional manager seems to he doing the better job? Why?

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Division Queensland New South Wales Sales S7,000,000 $4,000,000 Average operating assets $2,000,000 $2,000,000 Net operating income Property, plant and equipment (net) S360,0000 $420,000 $950,000 $800,000