Kaler Company has sales of $$1,370,000,$ cost of goods sold of $$775,000,$ other operating expenses of $$188,000,$ average invested assets of $$4,200,000,$ and a hurdle rate of $12$ percent.

Required:

Determine Kaler$$s return on investment $($ROI$),$ investment turnover, profit margin, and residual income.

Several possible changes Kaler could face in the upcoming year follow. Determine each scenario$$s impact on Kaler$$s ROI and residual income. $($Note: Treat each scenario independently.$)$

Company sales and cost of goods sold increase by $10$ percent.

Operating expenses increase by $$81,000.$

Operating expenses decrease by $10$ percent.

Average invested assets decrease by $$365,000.$

Kaler changes its hurdle rate to $9$ percent.