Effect of Proposals on Divisional Performance A condensed income statement for the Electronics Division of Gihbli Industries Inc. for the year ended December 31, 20Y9, is as follows: Sales $2,160,000 Cost of goods sold 1,650,000 Gross profit $ 510,000 Operating expenses 294,000 Income from operations $ 216,000 Invested assets $1,800,000 Assume that the Electronics Division received no charges from service departments. The president of Gihbli Industries Inc. has indicated that the divisions return on a $1,800,000 investment must be increased to at least 14% by the end of the next year if operations are to continue. The division manager is considering the following three proposals: Proposal 1: Transfer equipment with a book value of $360,000 to other divisions at no gain or loss and lease similar equipment. The annual lease payments would be less than the amount of depreciation expense on the old equipment by $64,800. This decrease in expense would be included as part of the cost of goods sold. Sales would remain unchanged. Proposal 2: Reduce invested assets by discontinuing a product line. This action would eliminate sales of $382,500, reduce cost of goods sold by $255,600, and reduce operating expenses by $112,500. Assets of $911,300 would be transferred to other divisions at no gain or loss. Proposal 3: Purchase new and more efficient machinery and thereby reduce the cost of goods sold by $237,600 after considering the effects of depreciation expense on the new equipment. Sales would remain unchanged, and the old machinery, which has no remaining book value, would be scrapped at no gain or loss. The new machinery would increase invested assets by $900,000 for the year. Required: Question Content Area 1. Using the DuPont formula for return on investment, determine the profit margin, investment turnover, and rate of return on investment for the Electronics Division for the past year. Round your answers to one decimal place. Electronics Division Profit margin fill in the blank 4a0812fe006a001_1 % Investment turnover fill in the blank 4a0812fe006a001_2 ROI fill in the blank 4a0812fe006a001_3 % Question Content Area 2. Prepare condensed estimated income statements and compute the invested assets for each proposal. Gihbli Industries Inc.Electronics Division Estimated Income Statements For the Year Ended December 31, 20Y9 Proposal 1 Proposal 2 Proposal 3 Sales $fill in the blank 374d3600104bfba_1 $fill in the blank 374d3600104bfba_2 $fill in the blank 374d3600104bfba_3 Cost of goods sold fill in the blank 374d3600104bfba_4 fill in the blank 374d3600104bfba_5 fill in the blank 374d3600104bfba_6 Gross profit $fill in the blank 374d3600104bfba_7 $fill in the blank 374d3600104bfba_8 $fill in the blank 374d3600104bfba_9 Operating expenses fill in the blank 374d3600104bfba_10 fill in the blank 374d3600104bfba_11 fill in the blank 374d3600104bfba_12 Income from operations $fill in the blank 374d3600104bfba_13 $fill in the blank 374d3600104bfba_14 $fill in the blank 374d3600104bfba_15 Invested assets $fill in the blank 374d3600104bfba_16 $fill in the blank 374d3600104bfba_17 $fill in the blank 374d3600104bfba_18 Question Content Area 3. Using the DuPont formula for return on investment, determine the profit margin, investment turnover, and return on investment for each proposal. Round your answers to one decimal place. Proposal Profit Margin Investment Turnover ROI Proposal 1 fill in the blank 0f9483015fec004_1 % fill in the blank 0f9483015fec004_2 fill in the blank 0f9483015fec004_3 % Proposal 2 fill in the blank 0f9483015fec004_4 % fill in the blank 0f9483015fec004_5 fill in the blank 0f9483015fec004_6 % Proposal 3 fill in the blank 0f9483015fec004_7 % fill in the blank 0f9483015fec004_8 fill in the blank 0f9483015fec004_9 % 4. Which of the three proposals would meet the required 14% return on investment. Proposal 1 Proposal 2 Proposal 3 5. If the Electronics Division were in an industry where the profit margin could not be increased, how much would the investment turnover have to increase to meet the president's required 14% rate of return on investment? Enter your increase in investment turnover answer as a percentage of current investment turnover. If required, round your answer to one decimal place. fill in the blank 0f9483015fec004_13 %