Coolbrook Company has the following information available for the past year Sales revenue Cost of goods sold and operating expenses Net operating income Average invested assets River Stream Division Division $ 1,210,000 $ 1,801,000 891,000 1,281,000 $ 319,000 $ 520,000 $ 1,160,800 $ 1,560,000 The company's hurdle rate is 676 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 $242,000 in each division, an amount that generates $120,000 additional income per division d. Coolbrook changes its hurdle rate to 4.76 percent. Complete this question by entering your answers in the tabs below. Reg 1 Reg 2A Req 2B Req 2c Req 2D Calculate return on investment (ROI) and residual income for each division for last year. (Enter your ROI answers as a percentage rounded to two decimal places, (i.e., 0.1234 should be entered as 12.34%.)) Stream Division River Division % ROI Residual Income (Loss) Req 2A > Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Reg 28 Req 2c Req 2D Recalculate ROI and residual income for each division for the independent situation that follows: Operating income increase by 9 percent. (Enter your ROI answers as a percentage rounded to two decimal places, (I.e., 0.1234 should be entered as 12.34%.). Loss amounts should be indicated with a minus sign.) River Division Stream Division ROI Residual Income (Loss) Complete this question by entering your answers in the tabs below. Reg 1 Req 2A Reg 2B Reg 2C Reg 2D Recalculate ROI and residual income for each division for the independent situation that follows: Operating income decreases by 12 percent. (Enter your ROI answers as a percentage rounded to two decimal places, (i.e., 0.1234 should be entered as 12.34%.). Loss amounts should be indicated with a minus sign.) River Division Stream Division % % ROI Residual Income (Loss) Complete this question by entering your answers in the tabs below. Req 1 Req 2A Req 2B Req 2 Req 2D Recalculate ROI and residual income for each division for the independent situation that follows: The company invests $242,000 in each division, an amount that generates $120,000 additional income per division. (Enter your ROI answers as a percentage rounded to two decimal places, (i.e., 0.1234 should be entered as 12.34%.). Round your "Residual Income (Loss) answer to the nearest whole dollars. Loss amounts should be indicated with a minus sign.) Show less River Division Stream Division ROI % Residual Income (Loss) Complete this question by entering your answers in the tabs below. Reg 1 Req 2A Req 2B Req 2c Regho Recalculate ROI and residual income for each division for the independent situation that follows: Coolbrook changes its hurdle rate to 4.76 percent. (Enter your ROI answers as a percentage rounded to two decimal places, (i.e., 0.1234 should be entered as 12.34%.). Loss amounts should be indicated with a minus sign.) River Division Stream Division ROI % Residual Income (Loss) %
