13 2.59 Sweetwell Co, is considering outsourcing a part it currently manufactures, Costs that are relevant to the make-or-buy decision include all of the following except: O Salarices that will not be incurred it the part is outsourced O Current direct materials cost of the part to be outsourced Special machinery Lised to make the part that has no resale value O Materials handling costs that can be eliminated O All of the above are relevant to the outsourcing decision 17 2.5 Which of the following is not a way managers could increase their business unit's return on investment (ROI)? (For each alternative, assume all else is constant.) O Increase assets such as receivables Increase revenues O Decrease costs O Reduce inventory All of the above would increase ROI 19 2.5$ CQ Company's return on sales was 30% in the month of November and its investment turnover ratio was 5.0. If the company's return on sales remains the same in December but its turnover ratio increases by 10%, then the company's return on investment in December would: O decrease by 10% remain the same o increase by 10% O increase by 15% None of the above LP 20 2.5 The following information pertains to questions 20 - 22. Sales revenue for the Northern Division of Batdorf Company for the most recent period was $4,650,000. Northern Division has a variable cost ratio of 60% and total fixed costs of $465,000. Operating assets at the end of the period were $4,025,000, which represents a 15% increase over the beginning balance. Return on investment and residual income for Northern Division are computed based on average operating assets. The required rate of return at Batdorf Company is 10%. Q20. What is Northern Division's margin (or return on sales) for the period? O 5% 8% O 10% O 30% O None of the above