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Luke Company has three divisions: Peak, View, and Grand. The company has a hurdle rate of 6.51 percent. Selected operating data for the three divisions
Luke Company has three divisions: Peak, View, and Grand. The company has a hurdle rate of 6.51 percent. Selected operating data for the three divisions follow:
Peak | View | Grand | ||||
Sales revenue | $ | 338,000 | $ | 236,000 | $ | 309,000 |
Cost of goods sold | 211,000 | 116,000 | 191,000 | |||
Miscellaneous operating expenses | 41,000 | 38,000 | 38,000 | |||
Average invested assets | 1,260,000 | 880,000 | 1,165,000 | |||
1. Compute the return on investment for each division. (Enter your ROI answers as a percentage rounded to two decimal places, (i.e., 0.1234 should be entered as 12.34%.)) (Find peak%,view% and grand % for ROI 2. Compute the residual income for each division. (Loss amounts should be indicated by a minus sign. Round your answers to nearest whole dollar.) (Find peak,view and grand.) |
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