Question The Mototech group comprises two companies, H Co and P Co. H Co is a trading company with two divisions: The Design division, which designs wind turbines and supplies the designs to customers under licences and the Matobox division, which manufactures gearboxes for the car industry. P CO manufactures components for gearboxes. It sells the components globally and also supplies H Co with components for its Motobox manufacturing division. The financial results for the two companies for the year ended 31 May 2017 are as follows: Design division Motobox division $'000 $'000 $'000 External sales 14,300 25,535 8,010 Sales to Motobox division 7.550 15,560 Cost of sales (4,900) (16,200) (5,280) Administration costs (3,400) (4,200) (2,600) Distribution costs (1,260) Operating profit 6,000 3.875 7,010 Capital employed 23,540 32,320 82,975 * Includes cost of components purchased from P Co. (670) Required: Discuss the performance of P Co and each division of H Co, calculating and using the following three performance measures: 1. Return on capital employed (ROCE) II. Asset turnover III. Operating profit margin