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Exercise 11-13 Effects of Changes in Sales, Expenses, and Assets on ROI [LO11-1] [The following information applies to the questions displayed below.] CommercialServices.com Corporation provides
Exercise 11-13 Effects of Changes in Sales, Expenses, and Assets on ROI [LO11-1] [The following information applies to the questions displayed below.] CommercialServices.com Corporation provides business-to-business services on the Internet. Data concerning the most recent year appear below: Sales Net operating income Average operating assets $ 11,880,000 $ 1,069,200 $ 2,700,000 Exercise 11-13 Part 1 Required: 1. Compute the company's margin, turnover and return on investment (ROI). (Do not round intermediate calculations. Round your percentage answers to 2 decimal places (i.e., 0.1234 should be considered as 12.34%.)) Margin Turnover ROI Exercise 11-13 Part 2 2. The entrepreneur who founded the company is convinced that sales will increase next year by 160% and that net operating income will increase by 420%, with no increase in average operating assets. What would be the company's ROI? (Do not round intermediate calculations. Round your percentage answers to 2 decimal places (i.e., 0.1234 should be considered as 12.34%.)) Margin Turnover ROI Exercise 11-13 Part 3 3. The Chief Financial Officer of the company believes a more realistic scenario would be a $3,000,000 increase in sales, requiring a $1,020,000 increase in average operating assets, with a resulting $671,760 increase in net operating income. What would be the company's ROI in this scenario? (Do not round intermediate calculations. Round your percentage answers to 2 decimal places (i.e., 0.1234 should be considered as 12.34%.)) Margin % Turnover ROI
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