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 I make any move. Our division's return on investment (ROl) has led the company for three years and I don't want any letdown." Billings Company is a decentralized wholesaler with five autonomous divisions. The divisions are evaluated on the basis of ROl, with year-end bonuses given to the divisional managers who have the highest ROls. Operating results for the company's Office Products Division for this year are given below: Sales Variable expenses Contribution margin rixed expenses Net operating income Divisional average operating assets $ 21,200,000 13,405, 600 7,794,400 5,950,000 1,844,400 $ 4,240,000 The company had an overall return on investment (ROI) of 19.00% this year (considering all divisions). Next year the Office Products Division has an opportunity to add a new product line that would require an additional investment that would increase average operating assets by $2,600,000. The cost and revenue characteristics of the new product line per year would be Sales Variable expenses Fixed expenses $9,100,000 65% of sales $2,538,900