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c. An automobile parts 'company has three divisions: Sales Contribution margin Operating income Investment base Engines $ 8,000,000 2,000,000 1,500,000 12,000,000 Brakes $ 9,000,000 2,500,000
c. An automobile parts 'company has three divisions: Sales Contribution margin Operating income Investment base Engines $ 8,000,000 2,000,000 1,500,000 12,000,000 Brakes $ 9,000,000 2,500,000 1,500,000 14,000,000 Windshields $ 10,000,000 3,500,000 2,750,000 16,000,000 The company's desired rate of return is 15%. a. Compute each divisions' ROI b. Compute each divisions' residual income c. Rank each division by both ROI and residual income d. Explain which division has the best performance in the year and why 116%
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