Divisional Performance Analysis and Evaluation

The vice president of operations of Morrison IQ Company is evaluating the performance of two divisions organized as investment centers. Invested assets and condensed income statement data for the past year for each division are as follows:

	Business Division		Consumer Division
Sales	$ 2,640,000		$ 2,700,000
Cost of goods sold	1,162,000		1,269,000
Operating expenses	1,029,200		891,000
Invested assets	2,200,000		1,800,000

Required:

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1. Prepare condensed divisional income statements for the year ended December 31, 2014, assuming that there were no service department charges.

Divisional Performance Analysis and EvaluationThe vice president of operations of Morrison IQ Company is evaluating the performance of two divisions organized as investment centers. Invested assets and condensed income statement data for the past year for each division are as follows: 1. Prepare condensed divisional income statements for the year ended December 31, 2014, assuming that there were no service department charges.Using the Du point for rate of return on investment, determine the profit margin , investment turnover and rate of return on investment for each division. If required, round your answers to one decimal place. On the basis of residual income the Division is the more profitable of the two division. On the basis of income from operations, the Davison is the more profitable of the two division