!ALL ANSWERS PLEASE!

Westerville Company reported the following results from last years operations:

Sales	$	1,500,000
Variable expenses		500,000
Contribution margin		1,000,000
Fixed expenses		700,000
Net operating income	$	300,000
Average operating assets	$	1,000,000

At the beginning of this year, the company has a $200,000 investment opportunity with the following cost and revenue characteristics:

Sales	$	300,000
Contribution margin ratio		60	% of sales
Fixed expenses	$	132,000

The companys minimum required rate of return is 10%.

1-What is last years margin?

2-What is last years turnover?

3-What is last years return on investment (ROI)?

4-What is the margin related to this years investment opportunity?

5-What is the turnover related to this years investment opportunity?

6-What is the ROI related to this years investment opportunity?

7-If the company pursues the investment opportunity and otherwise performs the same as last year, what margin will it earn this year?

8-If the company pursues the investment opportunity and otherwise performs the same as last year, what turnover will it earn this year?

9- If the company pursues the investment opportunity and otherwise performs the same as last year, what ROI will it earn this year?

10-What is last years residual income?

11-What is the residual income of this years investment opportunity?

12-If the company pursues the investment opportunity and otherwise performs the same as last year, what residual income will it earn this year?