Problem $1(37$ points$)$

Terry Enterprises, Inc. has two divisions $-$ the Foods division and the Clothes division. Historically, Terry has used the division's ROI as the performance measure for the bonus determinations. Terry Foods division has gross total assets of $$1,000,000,$ accumulated depreciation of $$350,000,$ current liabilities of $$250,000,$ and sales of $$2,000,000.$ Foods' operating income is $$220,000.$ Terry Clothes division has gross total assets of $$5,000,000,$ accumulated depreciation of $$2,100,000,$ current liabilities of $$1,500,000,$ and sales of $$8,000,000.$ Clothes' operating income is $$770,000.$

Use the DuPont formula to compute ROI for each division and for Terry Enterprises as a whole. Use operating income and gross total assets as the measures of income and investment.

Round answers to the nearest whole percentage.

Problem $2(10$ Points$)$

Marshfield Tax Company considers $8,000$ direct labor hours or $400$ tax returns its normal monthly capacity. Its standard variable overhead rate is $$3$ per direct labor hour. During the current month, $$24,500$ of variable overhead cost was incurred in working $7,500$ direct labor hours to produce $360$ units of product. Determine the following variable overhead variances, and indicate whether each is favorable or unfavorable:

Do not use negative signs with any of your answers. Next to each variance answer, select either $"F"$ for Favorable or $"$U$"$ for Unfavorable.