KU Check my work Oscat Clemente le mariager of Forbes Division of Inca mam tacturer of biotech products. Forbes: Division, which has $4 million in assets, manifactures a special testing device. At the beginning of the current year. Forbes invested $3.5 milion in automated apment for test machine assembly. The nexpected income statement at the beginning of the year was as follows 115, Sale Operating costs Verile (all) Depreciation 2.950. 2. 1.44 2. son Derating proti Aprivetim SI M. Com approached OscOdobest for Swasembly machine that is significant moms over we women Oscat bogati numing of the year wint would expand division to pesce while reducing cash couts by cunt would be depreciated for accounting purossover we Depreciation we het of 600.000 g value of the new machine the newegument meets 20 percent cost of caprion Oscarcases the new machimbe installed prior to end of the year. For practical purpose tvo Osca con mot deprecatione pewmachine because will go into operation the start of the naty The old mature wristus no se must be discoved of to make room for the new machine Pancevolution and bonus on based on the return into any losses on disposal of equipment. Investment is com based on the end of year halance of net to value force awes Red W Fortes Goes to the new machine?(Enter your answer as a percentage rounded to 1 ploce. 32.11.1 Forbes carache new machine (Enter your answers percentage rounded to Ayo MUDUK Value ignore taxes. Required: . What is Forbes Division's ROI Oscar does not acquire the new machine? (Enter your answer as a percentage rounded to 1 decimal place le 32.1).) b. What is Forbes Division's Rol this year of Oscar acquires the new machine? (Enter your answer as a percentage rounded to 1 decimal place .., 32.1). c. O acquires the new machine and it operates according to specifications, what Rot is expected for next year? (Enter your answer as a percentage rounded to 1 decimal place (l.e., 32.1).) ROU ROL lo Hol Oscar Clemente is the manager of Forbes Division of Pitt, Inc., a manufacturer of biotech products. Forbes Division, which has $4 million in assets, manufactures a special testing device. At the beginning of the current year. Forbes invested $3.5 million in automated equipment for test machine assembly. The division's expected income statement at the beginning of the year was as follows. $15,800,000 Sales, revenue Operating costs Variable Fixed (all cash) Depreciation The equipment Other Division operating profit 2,050,000 7,100,000 1,460,000 1,200,000 $ 3,990,000 A sales representative from LSI Machine Company approached Oscar in October. LSI has for $575 million a new assembly machine that offers significant improvements over the equipment Oscar bought at the beginning of the year. The new equipment would expand division output by 10 percent while reducing cash fixed costs by 5 percent. It would be depreciated for accounting purposes over a 3. year life. Depreciation would be net of the $500,000 salvage value of the new machine. The new equipment meets Pit's 20 percent cost of capital criterion. If Oscar purchases the new machine, it must be installed prior to the end of the year. For practical purposes. though. Oscar can ignore depreciation on the new machine because it will not go into operation until the start of the next year. The old machine, which has no salvage value, must be disposed of to make room for the new machine Putt has a performance evaluation and bonus plan based on ROI. The return includes any losses on disposal of equipment Investment is computed based on the end-of-year balance of assets, netbook value. Ignore taxes Required: 6. What is Forbes Division's ROI If Oscar does not acquire the new machine? (Enter your answer as a percentage rounded to decimal place (l... 32.1).) b. What is Forbes Division's ROI this year if Oscar acquires the new machine? (Enter your answer as a percentage rounded to decimal place (.e., 32,4).) c. If Oscar acquires the new machine and it operates according to specifications, what Rol is expected for next year? (Enter your answer as o percentage rounded to 1 decimal place (ie., 32,1). 3 b ROI ROI ROI