Question
CommercialServices.com Corporation provides business-to-business services on the Internet. Data concerning the most recent year appear below: Sales $ 3,900,000 Net operating income $ 273,000 Average
CommercialServices.com Corporation provides business-to-business services on the Internet. Data concerning the most recent year appear below:
Sales | $ | 3,900,000 |
Net operating income | $ | 273,000 |
Average operating assets | $ | 780,000 |
Garrison 16e Rechecks 2019-01-10
Exercise 11-13 Part 2
1. Compute the company's return on investment (ROI). (Do not round intermediate calculations. Round your answer to 2 decimal places.) ROI==(35%) 2. The entrepreneur who founded the company is convinced that sales will increase next year by 60% and that net operating income will increase by 100%, with no increase in average operating assets. What would be the companys ROI? (Do not round intermediate calculations. Round your answer to 2 decimal places.) 3. The Chief Financial Officer of the company believes a more realistic scenario would be a $1,150,000 increase in sales, requiring a $230,000 increase in average operating assets, with a resulting $105,750 increase in net operating income. What would be the companys ROI in this scenario? (Do not round intermediate calculations. Round your answer to 2 decimal places.)
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