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Data table Benjamin Doore is a national paint manufacturer and retailer. The company is segmented into The following is selected divisional information for its two
Data table Benjamin Doore is a national paint manufacturer and retailer. The company is segmented into The following is selected divisional information for its two largest divisions. Paint Stores and five divisions: Paint Stores (branded retail locations), Consumer (paint sold through home Consumer. improvement stores), Automotive (sales to auto manufacturers), International, and Administration (Click the icon to view the information.) Read the requirements. Management has specified a 20% target rate of return. Requirement 1. Calculate each division's ROI. Round all of your answers to four decimal places. Begin by selecting the formula to calculate return on investment (ROI), and then enter the amounts to calculate each division's ROI. (Round your calculations to four decimal places and enter your answer as a bercent rounded to two decimal places, XX%) Requirement 2. Calculate each division's profit margin ratio. Interpret your results Begin by selecting the formula to calculate profit margin ratio, and then enter the amounts to calculate each division's profit margin ratio. (Enter each profit margin ratio as a percent rounded to two requirement 0 . Lalculate each uivisions asset tumovel tatlo. miterpiet yout iesults Begin by selecting the formula to calculate asset turnover ratio, and then enter the amounts to calculate each division's asset turnover ratio. (Round your answers to four decimal places, XXXXX ) The division is more efficient in generating sales with its average total assets. Requirement 4. Use the expanded ROI formula to confirm your results from Requirement 1. Interpret your results. First, select the expanded ROI formula. Now calculate ROI for each division using the expanded ROI formula. (Enter your answers as a percent rounded to two decimal places, X.XX\%.) Using the expanded formula, the ROl for the Paint Stores division is Using the expanded formula, the ROI for the Consumer division is The Consumer division's profitability on each dollar of net sales revenue is than the Paint Stores division's profitability. However, the Paint Stores division's efficiency is significantly Consumer division's efficiency. These results cause the Paint Stores division's ROI to be the Consumer division's ROI. Requirement 5. Calculate each division's RI. Interpret your results, and offer a recommendation for any division with negative RI. First, select the formula to calculate residual income (RI). Now calculate each division's RI. (Use a minus sign or parentheses to enter negative residual income.) The RI for the Paint Stores division is The Rl for the Consumer division is meeting management's target rate of return. A division with a negative RI should consider Requirement 6. Describe some of the factors that management considers when setting its minimum target rate of return. Management different minimum target rates for different divisions. For example, management require a higher target rate of retum from a division operating in a riskier business environment. Management will need to decide for the calculations and whether it should be net of
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