Exercise 11-7 Computing and Interpreting Return on Investment Selected operating data on the two divisions of Prism Company are given below. Division Eastern Western Sales $ Average operating assets $ 800,000 $ 300,000 1,850,000 S 400,000 Operating income S Plant and equipment S 70,000 125,000 $ Required: 115,000 200,000 included in AOA 1. Compute the rate of return for each division using the ROI formula stated in terms of margin and turnover. ROI Formula: Margin Operating income Sales Tumover Sales Easter ROI= Westem ROI= Average operating assets 23.33% (70000/800000) (800000/300000) 28.75% (115000/1850000) (1850000/400000) 2. Which divisional manager seems to be doing the better job? Western Division