Gibson Corporation operates three investment centers. The following financial stetements apply to the investment center named Bowman Division: BOWMAN DIVISION Income Statement For the Year Ended December 31, 2018 Sales revenue $106,580 Cost of goods sold Gross margin Operating expenses 58,875 47,705 ok Selling expenses 42,650) Depreciation expens0 (4,105) Operating income Sonoperating iten 40,950 ncesLoss of sale of (3,700) land Net income 37,250 BORNAX DIVISION Balance Sheet As of December 31, 2018 Assets Cash Accounts receivable Merchandise inventory Equipment less accunulated depreciation Nonoperating assets 12,642 40,376 37,900 90,438 Total assets $191,956 Liabi1ities Accounts payable Notes payable $ 9,467 71,000 stockholders' equity Common stock Retained earnings 76,000 35,489 ities and stockholder's $191,956 Zotal 1iabil equity Required c. Calculate the ROl for Bowman, d. Gibson hes a desired ROl of 14 percent. Headquarters has $91,000 of funds to assign to its investment centers. The manager of the Bowman Division has an opportunity to invest the funds at an ROl of 16 percent. The other two divisions have investment opportunities that yield only 15 percent. Calculate the new RO for Bowman division, if the investment opportunity is adopted by Bowman. e Based on the original data, calculate the original residual income. Also, calculate the new residual income based on d. Complete this question by entering your answers in the tabs below Required Required Required Calculate the ROI for Bowman. (Round your answer to 2 decimal places. (i.e., .2345 should be entered as 23.45).) Gibson Corporation operates three investment centers. The following financial stetements apply to the investment center named Bowman Division: BOWMAN DIVISION Income Statement For the Year Ended December 31, 2018 Sales revenue $106,580 Cost of goods sold Gross margin Operating expenses 58,875 47,705 ok Selling expenses 42,650) Depreciation expens0 (4,105) Operating income Sonoperating iten 40,950 ncesLoss of sale of (3,700) land Net income 37,250 BORNAX DIVISION Balance Sheet As of December 31, 2018 Assets Cash Accounts receivable Merchandise inventory Equipment less accunulated depreciation Nonoperating assets 12,642 40,376 37,900 90,438 Total assets $191,956 Liabi1ities Accounts payable Notes payable $ 9,467 71,000 stockholders' equity Common stock Retained earnings 76,000 35,489 ities and stockholder's $191,956 Zotal 1iabil equity Required c. Calculate the ROl for Bowman, d. Gibson hes a desired ROl of 14 percent. Headquarters has $91,000 of funds to assign to its investment centers. The manager of the Bowman Division has an opportunity to invest the funds at an ROl of 16 percent. The other two divisions have investment opportunities that yield only 15 percent. Calculate the new RO for Bowman division, if the investment opportunity is adopted by Bowman. e Based on the original data, calculate the original residual income. Also, calculate the new residual income based on d. Complete this question by entering your answers in the tabs below Required Required Required Calculate the ROI for Bowman. (Round your answer to 2 decimal places. (i.e., .2345 should be entered as 23.45).)
