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Megamart provides the following information on its two investment centers. Exercise 24-10 (Algo) Computing return on investment and residual income; investing decision LO A1 1.
Megamart provides the following information on its two investment centers. Exercise 24-10 (Algo) Computing return on investment and residual income; investing decision LO A1 1. Compute return on investment for each center. Using return on investment, which center is most efficient at using assets to generate income? 2. Assume a target income of 11% of average assets. Compute residual income for each center. Which center generated the most residual income? 3. Assume the Electronics center is presented with a new investment opportunity that will yield a 15% return on investment. Shoulc the new investment opportunity be accepted? The target return is 11%. Complete this question by entering your answers in the tabs below. Compute return on investment for each center. Using return on investment, which center is most efficient at using assets to generate income? Assume a target income of 11% of average assets. Compute residual income for each ce most residual income? Assume the Electronics center is presented with a new investmer Should the new investment opportunity be accepted? The target Should the new investment opportunity be accepted? Jose Ruiz manages a construction firm's equipment repair department. His department is a cost center. Costs for a recent perioc follow. Jose cannot control his salary, rent, or insurance. Compute total controllable costs that would appear on a responsibility accounting report for the repair department. Macee Store has three operating departments, and it conducts advertising that benefits all departments. Advertising costs are $142,000. Sales for its operating departments follow. How much advertising cost is allocated to each operating department if the allocation is based on departmental sales? Note: Do not round your intermediate calculations. SodaPop Company has two operating departments: Mixing and Bottling. Mixing has 490 employees and Bottling has 210 employees. Office costs of $182,000 are allocated to operating departments based on the number of employees. Determine the office costs allocated to each operating department. A retailer pays $200,000 rent each year for its two-story building. Space in this building is occupied by five departments as shown here. The company allocates $150,000 of total rent expense to the first floor and $50,000 to the second floor. It then allocates rent expense for each floor to the departments on that floor based on square feet occupied. Determine the rent expense to be allocated to each department
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