\fThe income statement for Huerra Company for last year is provided below: Total Unit Sales. $12,866,666 s 256.66 Less: Variable expenses 16,246,666 264.86 Contribution margin 2,566,666 51.26 Less: Fixed expense 1,286,666 25.66 Net operating income 1,286,666 25.56 Less: Income taxes @1 36% 384,666 158 Net income $ 896,666 $ 1?.62 The company had average operating assets of $8,000,000 during the year. Required: 1. Compute the company's ROI for the period using the ROI formula stated in terms of margin and turnover. (Round intermediate calculation to 2 decimal places. Enter your percentage answer rounded to 2 decimal places ti.e., 0.1234 should be entered as 12.34).) -- 2. Consider each ofthe following questions separately and then compute the new ROI figure. Indicate whether the ROI will increase, decrease. or remain unchanged as a result ofthe events described. a. By using JlT, the company is able to reduce the average level of inventory by $300000. (The released funds are used to pay off shortterm creditors} {Round intermediate calculation to 2 decimal places. Enter your percentage answer rounded to 2 decimal places {i.e., 0.1234 should be entered as 12.34).) -I_ b. The company achieves a savings of $13 per unit by using cheaper materials. [Round intermediate and final answer to 2 decimal places} --_ c. The company issues bonds and uses the proceeds to purchase machinery and equipment, thus increasing the average assets by $200,000. Interest on the bonds is $20,000 per year. Sales remain unchanged. The new. more efficient equipment reduces xed production costs by $10,000 per year. (Round intermediate and final answer to 2 decimal places.) --_ d. As a result ofa more intense effort by the sales staff, sales are increased by 20%; operating assets remain unchanged. [Round intermediate and final answer to 2 decimal places.) --_ e. Obsolete items ofinventory carried on the records at a cost of $110,000 are scrapped and sold for 15% of the book value. (Use full amount of scrap while calculating average operating assets. Round intermediate calculation to 2decimal places. Enter your percentage answer rounded to 2 decimal places [i.e., 0.1234 should be entered as 12.34).) --_ f. The company uses $500,000 in cash [received on accounts receivable) to repurchase and retire some of its common shares. The net effect ofthis transaction is a $500,000 change in average operating assets. {Use full amount of scrap while calculating average operating assets. Round intermediate calculation to 2 decimal places. Enter your percentage answer rounded to 2 decimal places [i.e., 0.1234 should be entered as 12.34).) --_ g. The company pays a cash dividend to its shareholders, which results in a $400,000 change in average operating assets. {Round intermediate calculation to 2 decimal places. Enter your percentage answer rounded to 2 decimal places {i.e., 0.1234 should be entered as 12.34).)