Exercise 13-24 Components of ROI (L0 13-2) The following data pertain to Dakota Division's most recent year of operations. Income $ 5,666,666 Sales revenue 53,666,666 Average invested capital 19,566,666 Required: Compute Dakota Division's sales margin, capital turnover, and return on investment for the year. (Round your answers to 2 decimal places (i.e., .1234 should be entered as 12.34).) Sales margin Capital turnover Return on investment Exercise 13-25 Improving ROI (LO 13-3) The following data pertain to Dakota Division's most recent year of operations. Income $ 10, 520,000 Sales revenue 131, 500, 000 Average invested capital 65, 750, 000 Required: Which of the following ways could improve the Dakota Division's ROI to 20 percent? (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer. Any boxes left with a question mark will be automatically graded as incorrect.) ? Improve the sales margin to 9 percent by increasing income to $11,835,000. ? Improve the sales margin to 10.00 percent by increasing income to $13,150,000. ? Improve the turnover to 2.222 by decreasing average invested capital to $59,175,000 ? Improve the turnover to 2.500 by decreasing average invested capital to $52,600,000.Exercise 13-26 Residual Income (LO 13-2) The following data pertain to Dakota Division's most recent year of operations. Income $ 12,500,000 Sales revenue 220,000,000 Average invested capital 51,000,000 Assume that the company's minimum desired rate of return on invested capital is 11 percent. Required: Compute Dakota Division's residual income for the year. _:| Required information Exercise 13-29 ROI; Residual lncome(LO13-1,13-2) [The following information applies to the questions displayed below] Wyalusing Industries has manufactured prefabricated houses for over 20 years. The houses are constructed in sections to be assembled on customers' lots. Wyalusing expanded into the precut housing market when it acquired Fairmont Company, one of its suppliers. In this market, various types of lumber are precut into the appropriate lengths, banded into packages, and shipped to customers' lots for assembly. Wyalusing designated the Fairmont Division as an investment center. Wyalusing uses return on investment (ROI) as a performance measure with investment defined as average productive assets. Management bonuses are based in part on ROI. All investments are expected to earn a minimum return of 15 percent before income taxes. Fairmont's ROI has ranged from 19.9 to 23.1 percent since it was acquired. Fairmont had an investment opportunity in 20x1 that had an estimated ROI of 18 percent. Fairmont's management decided against the investment because it believed the investment would decrease the division's overall ROI. The 20x1 income statement for Fairmont Division follows. The division's productive assets were $35,700,000 at the end of 20x1, a 5 percent increase over the balance at the beginning of the year. FAI RMONT DIVISION Income Statement For the Year Ended December 31, 26x1 (in thousands) Sales revenue $51,940 Cost of goods sold 35,600 Gross margin $26,349 Operating expenses: Administrative $4,689 Selling 14,696 19, 379 Income from operations before income taxes $ 5,979 Exercise 13-29 Part 2 2. Would the management of Fairmont Division have been more likely to accept the investment opportunity it had in 20x1 if residual income were used as a performance measure instead of ROI? 0 Yes O No