HW #9 Q 3

Racer Sports Company makes snowboards, downhill skis, cross-country skis, skateboards, surfboards, and in-line skates. The company has found it beneficial to split operations into two divisions based on the climate required for the sport: Snow Sports and Non-Snow Sports. The following divisional information is available for the past year: (Click the icon to view the information.) Read the requirements ! 1. Enter the formula, then calculate each divisions ROI. (Enter the ROI as a percent rounded to the nearest tenth of a percent, X.X%.) = ROI 1 Requirements nequirements 1. Calculate each division's ROI. 2. Top management has extra funds to invest. Which division will most likely receive those funds? Why? 3. Can you explain why one division's ROI is higher? How could management gain more insight? Print Done Data table ar Sales Operating Income Total Assets Current Liabilities Snow Sports $ 5,400,000 $ 1,034,000 $ 4,400,000 $ 440,000 Non-Snow Sports $ 8,300,000 $ 1,291,500 $ 6,300,000 $ 665,000 Racer's management has specified a target 13% rate of return. Print Done