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Consolidated Industries is a diversified manufacturer with business units organized as divisions, including the Reigis Steel Division Consolidated monitors its divisions on the basis of

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Consolidated Industries is a diversified manufacturer with business units organized as divisions, including the Reigis Steel Division Consolidated monitors its divisions on the basis of both unit contribution and return on investment (ROI), with investment defined as average operating assets employed. All investments in operating assets are expected to earn a minimum return of 12% before income taxes. Reigis's cost of goods sold is considered to be entirely variable; however, its administrative expenses do not depend on volume. Selling expenses are a mixed cost with one-third attributed to sales volume. The 2019 operating statement for Reigis follows. The division's operating assets employed were $265,000,000 at November 30, 2019, unchanged from the year before. RECIS STEEL DIVISION Operating Statement For the Year Ended November 30, 2019 (0005 omitted) Sales revenue $146,000 Los expenses Cont of goods sold $ 75,500 Administrative expenses 15,000 Selling expenses 12,600 103,100 Income from operations, before tax $42.900 Required: 1. Calculate Reigs Steel Division's unit contribution if it produced and sold 2,600,000 units during the year ended November 30, 2019 (Round your answer to 2 decimal places.) 2. Calculate the following performance measures for 2019 for Relgis: a. Pretox Roi , based on average operating assets employed. (Round your answer to 2 decimal places.) b. Residual income (RI), calculated on the basis of average operating assets employed. (Enter your answer in whole dollars, not in thousands.) por unit 1. Contribution margin 2a. Return on investment % a. Pretax ROI, based on average operating assets employed. (Round your answer to 2 decimal places.) b. Residual income (RI), calculated on the basis of average operating assets employed. (Enter your answer in whole dollars, not in thousands.) 1. Contribution margin 20. Return on investment 26. Residual income per unit % 3. Rolls management is presented the opportunity to invest in a project that would carn an ROI of 13%, Relgis is likely to: O accept the project becouse ROI is higher than the required rate of return reject the project because the ROI would lower the current overall ROI O accept the project because positive ROI means a positive dollar value of return O reject the project because it poses too much risk

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