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Exercise 9-8 Return on Investment (ROI) and Residual Income Relations [LO1, LO2] A family friend has asked your help in analyzing the operations of three
Exercise 9-8 Return on Investment (ROI) and Residual Income Relations [LO1, LO2]
A family friend has asked your help in analyzing the operations of three anonymous companies operating in the same service sector industry. Supply the missing data in the table below: (Negative amounts should be indicated with a minus sign. Do not round immediate calculations, but round your final answers to the nearest whole number.) |
Company | ||||
A | B | C | ||
Sales | $ 360,000 | $ 690,000 | $ 680,000 | |
Net operating income | $ | $ 54,000 | $ | |
Average operating assets | $ 154,000 | $ | $ 156,000 | |
Return on investment (ROI) | 18% | 18% | % | |
Minimum required rate of return: | ||||
Percentage | 16% | % | 9% | |
Dollar amount | $ | $ 50,000 | $ | |
Residual income | $ | $ | $ 5,000 | |
|
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