FitPlus is a regional chain of health clubs. Each club's manager has the authority to make investments as needed and is evaluated based largely on ROI. FitPlus Club 52 reported the following results for the past year:

Required:
The following questions are to be considered independently. Carry out all computations to two decimal places.
1. Compute the club's ROI.
2. Assume that the manager of the club is able to increase sales by $80,000 and that as a result operating income increases by $6,000. Further assume that this is possible without any increase in operating assets. What would the club's ROI be?
3. Assume that the manager of the club is able to reduce expenses by $3,200 without any change in sales or operating assets. What would the club's ROI be?
4. Assume that the manager of the club is able to reduce operating assets by $20,000 without any change in sales or operating income. What would the club's ROI be?

Transcribed Image Text:

Sales... Operating income. Average operating assets.. $750,000 26,250 80,000