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Coolbrook Company has the following information available for the past year: Sales revenue River Division $1,220,090 Cost of goods sold and operating expenses 891,000
Coolbrook Company has the following information available for the past year: Sales revenue River Division $1,220,090 Cost of goods sold and operating expenses 891,000 Stream Division $1,813,000 1,290,000 Net operating income $ 329,000 $1,140,000 $ 523,000 $1,430,000 Average invested assets The company's hurdle rate is 7.26 percent. Required: 1. Calculate return on investment (ROI) and residual income for each division for last year. 2. Recalculate ROI and residual income for the division for each independent situation that follows: a. Operating income increases by 9 percent. b. Operating income decreases by 12 percent. c. The company invests $257,000 in each division, an amount that generates $100,000 additional income per division. d. Coolbrook changes its hurdle rate to 5.26 percent. Complete this question by entering your answers in the tabs below. Req 1 Req 2A Req 2B Req 20 Reg 2D Calculate return on investment (ROI) and residual income for each division for la a percentage rounded to two decimal places, (i.e., 0.1234 should be entered as 1 ROI Residual Income (Loss) River Division Stream Division % % Req 2A
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