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a) Juara Sdn. Bhd. had gross margin of RM550,000 and selling and administrative expense of RM300,000 last year. Also, Juara began last year with RM1,400,000

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a) Juara Sdn. Bhd. had gross margin of RM550,000 and selling and administrative expense of RM300,000 last year. Also, Juara began last year with RM1,400,000 of operating assets and ended the year with RM1, 100,000 of operating assets. Calculate return on investment for Juara Sdn. Bhd. b) Refer to 5(a) above. Juara Son.Bhd. requires a minimum rate of return 5%. Calculate residual income. Snack Goods Canned Foods Frozen Foods RM RM RM Revenues 784,000 940,800 1,050,000 Operating expenses (470,400) (700,000) (562,500) Operating income before support department allocations 313,600 240,800 487,500 Support department allocations (219,520) (99,680) (382,500) Operating income 94.080 141,120 105,000 Invested assets 448,000 940,800 750,000 i) Calculate ROI for each division ii) Determine the RI, assuming a minimum acceptable ROI is 14% iii) Assuming that divisional managers are evaluated and rewarded on the basis of ROI performance, which alternative do you think the divisional manager will choose

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