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 Division $1,213,000 899,000 $ 314,000 $1,060,000 Stream Division $1,803,000 1,288,000 $ 515,000 $1,400,000 The company's hurdle rate is 7.76 percent. Required: 1. Calculate return on investment (ROI) and residual income for each division for last year. 2. Recalculate'rol and residual income for the division for each independent situation that follows: a. Operating income increases by 9 percent. b. Operating income decreases by 11 percent. c. The company invests $254,000 in each division, an amount that generates $112,000 additional income per division. d. Coolbrook changes its hurdle rate to 5.76 percent. Complete this question by entering your answers in the tabs below. Reg 1 Reg 2A Reg 2B Req 2C Reg 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%.)) Complete this question by entering your answers in the tabs below. Reqi Req 2A Req 2B Req 2c Req 2D Calculate return on investment (ROI) and residual income for each division for last year. (Enter y percentage rounded to two decimal places, (i.e., 0.1234 should be entered as 12.34%.)) River Division % Stream Division % ROI Residual Income (Loss) IR Req 2A Complete this question by entering your answers in the tabs below. Reg 1 Req ZA Reg 2B Reg 20 Req 2D Reg 2A Recalculate ROI and residual income for each division for the independent situation that follows: Operating income increases by 9 percent. (Enter your ROI answers as a percentage rounded to two decimal places, (1.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) changes Its hurdle rate to 5.76 percent. come per division. Complete this question by entering your answers in the tabs below. Reg 1 Req 2A Reg 2 Req 2C Req 2D Recalculate ROI and residual income for each division for the independent situation that follows: Operating Income decreases by 11 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 Reg 2A Req 2B Req 2c Reg 2D Recalculate ROI and residual income for each division for the independent situation that follows: The company invests $254,000 in each division, an amount that generates $112,000 additional income per division. (Enter your ROI answers as a percentage rounded to two decimal places, (l.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 Reg 2A Req 28 Reg 2c Peq 20 Recalculate ROI and residual income for each division for the independent situation that follows: Coolbrook changes its hurdle rate to 5.76 percent. (Enter your ROI answers as a percentage rounded to two decimal places, (l.e., 0.1234 should be entered as 12.34%.). Loss amounts should be indicated with a minus sign.) Stream Division River Division % ROI Residual Income (Loss)
