Profit Margin, A component of the rate of return on investment, computed as the ratio of sales to invested assets.Investment Turnover, and A measure of managerial efficiency in the use of investments in assets, computed as income from operations divided by invested assets.Rate of Return on Investment

The condensed income statement for the International Division of King Industries Inc. is as follows (assuming no The costs of services provided by an internal service department and transferred to a responsibility center.service department charges):

Sales	$1,962,000
Cost of goods sold	882,900
Gross profit	$1,079,100
Administrative expenses	686,700
Income from operations	$392,400

The manager of the International Division is considering ways to increase the rate of return on investment.

a. Using the An expanded expression of return on investment determined by multiplying the profit margin by the investment turnover.DuPont formula for rate of return on investment, determine the profit margin, investment turnover, and rate of return on investment of the International Division, assuming that $3,270,000 of assets have been invested in the International Division. Round the investment turnover to one decimal place.

Profit margin	%
Investment turnover
Rate of return on investment	%

b. If expenses could be reduced by $98,100 without decreasing sales, what would be the impact on the profit margin, investment turnover, and rate of return on investment for the International Division? Round the investment turnover to one decimal place.

Profit margin	%
Investment turnover
Rate of return on investment	%