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10 Coolbrook Company has the following information available for the past year: 1.5 points Sales revenue Cost of goods sold and operating expenses Net
10 Coolbrook Company has the following information available for the past year: 1.5 points Sales revenue Cost of goods sold and operating expenses Net operating income Average invested assets River Division $ 1,210,000 891,000 $ 319,000 Stream Division $ 1,812,000 1,297,000 $ 515,000 $ 1,040,000 $ 1,580,000 The company's hurdle rate is 6.76 percent. Required: 1. Calculate return on investment (ROI) and residual income for each division for last year. 2. Recalculate ROI and residual income for the division for each independent situation that follows: a. Operating income increases by 11 percent. b. Operating income decreases by 12 percent. c. The company invests $245,000 in each division, an amount that generates $115,000 additional income per division. d. Coolbrook changes its hurdle rate to 4.76 percent. Answer is not complete. Complete this question by entering your answers in the tabs below. Req 1 Req 2A Req 2B Req 2C Req 2D Recalculate ROI and residual income for each division for the independent situation that follows: Operating income decreases by 12 percent. (Enter your ROI answers as a percentage rounded to two decimal places, (i.e., 0.1234 should be entered as 12.34%.). Loss amounts should be indicated with a minus sign.) ROI River Division 26.99% Stream Division % Residual Income (Loss) $ 186,080
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