Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Ohms Motor Company makes electric cars and has only two products, the Simplegreen and the Superiorgreen. To produce the Simplegreen. Ohms Motor employed assets

image text in transcribed

Ohms Motor Company makes electric cars and has only two products, the Simplegreen and the Superiorgreen. To produce the Simplegreen. Ohms Motor employed assets of $16,000,000 at the beginning of the period, and $16,500,000 of assets at the end of the period. Other costs to manufacture the Simplegreen include: (Click the icon to view the data.) General administration and selling costs total $34,768,000 for the period. In the current period, Ohms Motor produced 12,500 Simplegreen cars using 6,600 setup-hours and 125,000 machine-hours. Ohms Motor sold these cars for $17.000 each. The company bases its ROI on average invested capital Required 1. Assuming that Ohms Motor defines investment as average assets during the period, what is the ratum on investment (ROI) for the Simplegreen division? 2. Calculate the residual income (R) for the Simplegreen division if Ohms Motor has a required rate of return of 13% on investments X Data table as a Direct materials $ 8,400 per unit Setup Production $ $ 1,700 per setup-hour 445 per machine-hour

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial Accounting

Authors: W. Steve Albrecht, James D. Stice, Earl K. Stice

10th edition

324645570, 978-0324645576

More Books

Students also viewed these Accounting questions

Question

Test the series for convergence or divergence. ! 2. 1 n?

Answered: 1 week ago

Question

=+7. For the cost matrix of Exercise 3,

Answered: 1 week ago