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Determining Missing Items from Computations Data for the North, South, East and West divisions of Free Bird Company are as follows: Sales Income from Operations

Determining Missing Items from Computations

Data for the North, South, East and West divisions of Free Bird Company are as follows:

Sales Income from Operations Invested Assets Return on Investment Profit Margin Investment Turnover
North $860,000 (a) (b) 17.5% 7.0% (c)
South (d) $51,300 (e) (f) 4.5% 3.8
East $1,020,000 (g) $680,000 15.0% (h) (i)
West $1,120,000 $89,600 $560,000 (j) (k) (l)

a. Determine the missing items, identifying each by the letters (a) through (l). If required, round percents and investment turnover to one decimal place.

a. $
b. $
c.
d. $
e. $
f. %
g. $
h. %
i.
j. %
k. %
l.

b. Determine the residual income for each division, assuming that the minimum acceptable rate of return established by management is 12%.

Division Residual Income
North Division $
South Division $
East Division $
West Division $

c. Which division is the most profitable in terms of (1) return on investment and (2) residual income?

Most Profitable
1. Return on Investment
2. Residual Income

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