Question
Meets Auto Shop Inc. allows its divisions to operate as autonomous units. Their results for the current year were as follows: Sport Terrain City Revenues
Meets Auto Shop Inc. allows its divisions to operate as autonomous units. Their results for the current year were as follows:
|
| Sport | Terrain | City |
| Revenues | $1,800,000 | $900,000 | $6,100,000 |
| Current assets | 230,000 | 40,000 | 410,000 |
| Capital assets | 870,000 | 660,000 | 1,590,000 |
| Current liabilities | 100,000 | 100,000 | 500,000 |
| Net operating income | 250,000 | 60,000 | 660,000 |
| After-tax income | 188,400 | 36,400 | 484,400 |
| Weighted average cost of capital | 10% | 10% | 10% |
Required:
For each division compute (to two decimal) the:
- The margin %?
- Return on investment (to two decimal) %?
- Economic value added?
- Residual income?
- Turnover (to two decimal)?
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Accounting For Deferred Income Taxes
Authors: Bobby Carmichael
2nd Edition
1119724562, 9781119724568
