The Sports Equipment Division of Harrington Company is operated as a profit center. Sales for the division were budgeted for 2017 at $900,000. The only variable costs budgeted for the division were cost of goods sold ($440,000) and selling and administrative ($60,000). Fixed costs were budgeted at $100,000 for cost of goods sold, $90,000 for selling and administrative, and $70,000 for noncontrollable fixed costs. Actual results for these items were:

Sales............................................................................$880,000

Cost of goods sold

Variable........................................................................408,000

Fixed..............................................................................105,000

Selling and administrative

Variable..........................................................................61,000

Fixed................................................................................66,000

Noncontrollable fixed...............................................90,000

Instructions

(a) Prepare a responsibility report for the Sports Equipment Division for 2017.

(b) Assume the division is an investment center, and average operating assets were $1,000,000. The noncontrollable fixed costs are controllable at the investment center level. Compute ROI.