EXERCISE 11-10 Cost-Volume-Profit Analysis and Return on Investment (ROI) LO11-1 Posters.com is a small Internet retailer of high-quality posters. The company has $1,000,000 in operating assets and fixed expenses of $150,000 per year. With this level of operating assets and fixed expenses, the company can support sales of up to $3,000,000 per year. The company's contribution margin ratio is 25%, which means that an additional dollar of sales results in additional contribution margin, and net operating income of 25 cents. Required: 1. Complete the following table showing the relation between sales and return on investment (ROI). ROI Sales $2,500,000 $2,600,000 $2,700,000. $2,800,000 $2,900,000 $3,000,000 Net Operating Income $475,000 $? $? $? $? $? Average Operating Assets $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 ? ? ? 2 ? ? 2. What happens to the company's return on investment (ROI) as sales increase? Explain. EXERCISE 11-10 Cost-Volume-Profit Analysis and Return on Investment (ROI) LO11-1 Posters.com is a small Internet retailer of high-quality posters. The company has $1,000,000 in operating assets and fixed expenses of $150,000 per year. With this level of operating assets and fixed expenses, the company can support sales of up to $3,000,000 per year. The company's contribution margin ratio is 25%, which means that an additional dollar of sales results in additional contribution margin, and net operating income of 25 cents. Required: 1. Complete the following table showing the relation between sales and return on investment (ROI). ROI Sales $2,500,000 $2,600,000 $2,700,000. $2,800,000 $2,900,000 $3,000,000 Net Operating Income $475,000 $? $? $? $? $? Average Operating Assets $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 $1,000,000 ? ? ? 2 ? ? 2. What happens to the company's return on investment (ROI) as sales increase? Explain