Question
FutureMomentCo.has an opportunity to invest $1,687,500 in a project that willyield25%of Return on salesyearly. FutureMomentCo. has a 10% minimum acceptable rate of return. Additional information
FutureMomentCo.has an opportunity to invest $1,687,500 in a project that willyield25%of Return on salesyearly. FutureMomentCo. has a 10% minimum acceptable rate of return. Additional information is as follows:
Sales...............................................................................................................$1,350,000
Cost ofsales...................................................................................................498,500
Operating expenses........................................................................................210,000
Non-Operating expenses................................................................................115,000
Tax rate ................................................................... 25%
Operating earnings.....................................................................................A
Turnover Rate................................................................................................B
Profit Margin..................................................................................................C
Target Income............................................................D
Residual Income (RI) ................................................... E
Return on Investment (ROI)..............................................F
If operating Expenses decrease by 30% what is the Return on InvestmentG
If Sales increase by 15% and Expenses decrease by 30%
what is the Return on Investment.................... H
Requirements:1.Compute the letter A through H
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