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Posters.com is a small Internet retailer of high-quality posters. The company has $840,000 in operating assets and fixed expenses of $157,000 per year. With this
Posters.com is a small Internet retailer of high-quality posters. The company has $840,000 in operating assets and fixed expenses of $157,000 per year. With this level of operating assets and fixed expenses, the company can support sales of up to $5,400,000 per year. The company's contribution margin ratio is 10%, which means that an additional dollar of sales results in additional contribution margin, and net operating income, of 10 cents. Required: 1. Complete the following table showing the relation between sales and return on investment (ROI). Sales ROI Net Operating Income $ 333,000 Average Operating Assets $ 840,000 4,900,000 $ 840,000 5,000,000 $ 840,000 5,100,000 5,200,000 $ 840,000 $ 840,000 5,300,000 $ 840,000 5,400,000
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