Please explain this questions
2. The following data pertain to Queenstown Mining Company, a producer of sand, gravel and cement, for 2015: Sales revenue $12,000,000 Cost of goods sold $6,600,000 Operating expenses $4,800,000 Average invested capital $6,000,000 Required: a. Calculate the company's return on sales, investment turnover and ROI for 2015. b. If the sales and average invested capital remain the same in 2016, to what level would total expenses have to be reduced in order to increase the firm's ROI to 15 per cent? c. Assume that expenses are reduced, as calculated in requirement 2. Calculate the firm's return on sales. Show how the new return on sales and the old investment tumover together result in a ROI of 15 percent in 2016.3. Padstow Fabrics Company has two retail divisions, which reported the following result for 2015: Furnishing Dress making Division Division Profit $5,400 000 $1,200 000 Average invested capital $36,000 000 $6,000, 000 ROI 15% 20% Required: a. Which was the more successful division in 2015? Think carefully about this, and explain your answer. b. Calculate each division's residual income for 2015 under each of the following assumptions about the firm's required rate of return: (a) 20 per cent (b) 25 per cent (c) 30 per cent4. Dependable Rentals Ltd consists of two divisions. The Equipment Rental Division rents machinery, such as cement mixers and scissor lifts, to building contractors. The Truck Rental Division rents forklift trucks and removal trucks. The financial result for the two divisions in 2015 are as follows: Equipment Rental Truck Rental Division Division Operating profit after tax $45,000 $110,000 Total assets $750,000 $3,000,000 Current liabilities $80,000 $250,000 Dependable Rentals obtain its financing from long-term debt and shares. And the weighted cost of capital is estimated to be 10 per cent. To calculate ROI, invested capital is defined as total assets less current liabilities. Required: a. Calculate the ROI for the two divisions for 2015 b. Calculate the EVA for each division. Note that Dependable Rentals does not make any adjustments to its NOPAT c. Which division has performed better in 2015? Explain your answer1. Genre Go is a retailer that specialises in office supplies. It is a division of a large retail company. The following date relate to 2015: Profit $16,000 ,000 Sales Revenue $200,000 ,000 Average invested capital $80 ,000, 000 Required: a. Calculate Genre Go's return on sales, investment turnover and return on investment for 2015. b. Demonstrate two ways in which the manager of Genre Go could improve its ROI, increasing it to 25 per cent. c. Assume that the retail company has a required rate of retum of 10 percent, and calculate the residual income for Genre Go for 2015
