Divisional Income Statements and Return on Investment Analysis

The Crunchy Granola Company is a diversified food company that specializes in all natural foods. The company has three operating divisions organized as investment centers. Condensed data taken from the records of the three divisions for the year ended June 30, 20Y7, are as follows:

	Cereal Division		Snack Cake Division		Retail Bakeries Division
Sales	$25,000,000		$8,000,000		$9,750,000
Cost of goods sold	16,670,000		5,575,000		6,795,000
Operating expenses	7,330,000		1,945,000		2,272,500
Invested assets	10,000,000		4,000,000		6,500,000

The management of The Crunchy Granola Company is evaluating each division as a basis for planning a future expansion of operations.

Divisional Income Statements and Return on Investment Analysis The Crunchy Granola Company is a diversified food campery that specializes in all natural foods. The company has three operating divisions organized as investment centers. Condensed data taken from the records of the three divisions for the year ended June 30, 2047, are as follows: Cereal Division Snack Cake Division Retail Bakeries Division Sales $25,000,000 16,670,000 7,330,000 $8,000,000 5,575,000 Cost of goods sold Operating expenses 59,750,000 6,795,000 2,272,500 1,945,000 invested assets 10,000,000 4,000,000 6,500,000 The management of The Crunchy Granola Company is evaluating each division as a basis for planning a future expansion of operations, Required: 1. Prepare condensed divisional income statements for the three divisions, assuming that there were no support department allocations. The Crunchy Granola Company Divisional Income Statements For the Year Ended June 30, 2017 Retail Cereal Snack Cake Bakeries Division Division Division Sales Cost of goods sold 000001 Gross pront Operating expenses Operating income 2. Using the DuPont formula for return an investment, compute the profit mergin, investment turnover, and return on investment for each division. If required, round your answers to one decimal place. Division Profit Margin Investment Turnover ROI Cereal Division fi Srack Cake Division Retail Bakeries Division 95