"I know headquarters wants us to add that new product line said Dell Havasi, manager of Billings Company's Office Products Division. "But I want to see the numbers before l make any move. Our division's return on investment (RO) has led the company for three years, and l don't want any letdown Billings Company is a decentralized wholesaler with five autonomous divisions. The divisions are evaluated on the basis of ROI, with year-end bonuses given to the divisional managers who have the highest Rols. Operating results for the company's Office Products Division for the most recent year are given below: 22,300,000 Sales 13,999,600 Variable expenses contribution margin 8,300,400 Fixed expenses 6,115,000 2,185,400 Net operating income 5,575,000 Divisional operating assets The company had an overall return on investment (ROI) of 17.00% last year (considering all divisions). The Office Products Division has an opportunity to add a new product line that would require an additional investment in operating assets of $3,857,400. The cost and revenue characteristics of the new product line per year would be: 9,650,000 Sales 65% of sales Variable expenses 2,583,600 Fixed expenses