Ch.11 Q.1

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Pelak Company had sales of $5,032,000, expenses of $4,320,000, and average operating assets of $3,230,000. Required: 1. Compute the operating income. 2. Compute the margin (as a percent) and turnover ratio. If required, round your answers to one decimal place. Margin % Turnover X 3. Compute the ROI as a percent. Use the part 2 final answers in these calculations and round the final answer to two decimal places. % Feedback Check My Work 1. Sales - Expense = Operating Income 2. Margin = Operating Income/ Sales Turnover = Sales / Average Operating Assets 3. There are two ways to compute ROI as shown in the two formulas below: ROI = Margin Turnover