Compass Cleaning Company operates a chain of dry-cleaning stores across the country. Each store manager has authority to make investments as needed. Head office evaluates the performance of each store using ROI. The Neils Harbour location reported the following results for the past year: Sales $680,000 Operating income $28,750 Average operating assets $125,000 Required (Round all calculations to 2 decimal places)

A. Calculate the ROI for the Neils Harbour location

B. The manager of the Neils Harbour location is considering purchasing a new piece of equipment which will improve efficiency. The new piece of equipment will increase average operating assets by $20,000 and result in an increase of $7,500 to operating income. Calculate the updated ROI if this new piece of equipment were purchased.