Answered step by step
Verified Expert Solution
Question
1 Approved Answer
27 Part 1 of 3 4 points 8012519 Required information Exercise 11-16 (Algo) Effects of Changes in Sales, Expenses, and Assets on ROI [LO11-1]
27 Part 1 of 3 4 points 8012519 Required information Exercise 11-16 (Algo) Effects of Changes in Sales, Expenses, and Assets on ROI [LO11-1] [The following information applies to the questions displayed below] CommercialServices.com Corporation provides business-to-business services on the Internet Data concerning the most recent year appear below: Sales Net operating income Average operating assets $ 3,240,000 $194,400 $810,000 The following questions are to be considered independently Exercise 11-16 (Algo) Part 1 Required: 1. Compute the company's return on investment (ROI) Note: Do not round intermediate calculations. Round your answer to 2 decimal places. Return on investment (ROI) Required information Exercise 11-16 (Algo) Effects of Changes in Sales, Expenses, and Assets on ROI [LO11-1] [The following information applies to the questions displayed below] CommercialServices.com Corporation provides business-to-business services on the Internet Data concerning the most recent year appear below: Sales Net operating income Average operating assets $ 3,240,000 $194,400 $810,000 The following questions are to be considered independently Exercise 11-16 (Algo) Part 2 2. The entrepreneur who founded the company is convinced that sales will increase next year by 40% and that net operating income will increase by 250%, with no increase in average operating assets. What would be the company's ROI? Note: Do not round intermediate calculations. Round your answer to 2 decimal places. Return on investment (ROI) Required information Exercise 11-16 (Algo) Effects of Changes in Sales, Expenses, and Assets on ROI [LO11-1] [The following information applies to the questions displayed below] CommercialServices.com Corporation provides business-to-business services on the Internet. Data concerning the most recent year appear below: Sales Net operating income Average operating assets $ 3,240,000 $194,400 $810,000 The following questions are to be considered independently. Exercise 11-16 (Algo) Part 3 3. The Chief Financial Officer of the company believes a more realistic scenario would be a $1,300,000 increase in sales, requiring a $325,000 increase in average operating assets, with a resulting $429,850 increase in net operating income. What would be the company's ROI in this scenario? Note: Do not round intermediate calculations. Round your answer to 2 decimal places. Return on investment (ROI)
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started