East Mullett Manufacturing earned operating income last year as shown in the following income statement:

At the beginning of the year, the value of operating assets was $1,600,000. At the end of the year, the value of operating assets was $1,400,000.

Calculating Average Operating Assets, Margin, Turnover, and Return on Investment

Refer to the information for East Mullett Manufacturing above. Round answers to two decimal places.

Required:

Calculate (1) average operating assets, (2) margin, (3) turnover, and (4) return on investment.

\begin{tabular}{lr} Sales & $3,750,000 \\ Cost of goods sold & 2,250,000 \\ Gross margin & $1,500,000 \\ Selling and administrative expense & 1,200,000 \\ Operating income & $300,000 \\ Less: Income taxes (@ 40\%) & 120,000 \\ Net income & $180,000 \\ \hline \hline \end{tabular}