Zoes, a national manufacturer of lawn-mowing and snow-blowing equipment, segments its business according to customer type: professional and residential. The following divisional information was available for the past year:

	Net Sales	Operating Income		Average Total Assets
Residential	$540,000	$58,500		$180,000
Professional	1,070,000	152,000		380,000

Management has a 23% target rate of return for each division.

Requirements:

1. Calculate each division's ROI. Round all of your answers to four decimal places.

2. Calculate each division's profit margin ratio. Interpret your results.

3. Calculate each division's asset turnover ratio. Interpret your results.

4. Use the expanded ROI formula to confirm your results from Requirement 1. What can you conclude?'