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Ready Products Incorporated operates two divisions, each with its own manufacturing facility. The accounting system reports the following date for 2022: HEALTH CARE PRODUCTS DIVISION

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Ready Products Incorporated operates two divisions, each with its own manufacturing facility. The accounting system reports the following date for 2022: HEALTH CARE PRODUCTS DIVISION Income Statement For the Year Ended December 31, 2022 Revenues $ 1.200 Operating costs Operating income COSMETICS DIVISION Income Statement For the Year Ended December 31, 2022 Revenues Operating costs 460 Operating income $ 500 Ready estimates the useful life of each manufacturing facility to be 21 years. As of the end of 2022, the plant for the health care division is 4 years old, while the manufacturing plant for the cosmetics division is 6 years old. Each plant had the some cost at the time of purchase, and both have useful lives of 21 years with no selvage value. The company uses straight-line depreciation and the depreciation charge is $70,000 per year for each division. The manufacturing facility is the only long-lived asset of either division. Current assets are $312,000 in each division. An index of construction costs, replacement costs, and liquidation values for the manufacturing facilities for the period that Ready has been operating is as follows: Liquidation Value Year Cost Index Replacement Cost Health Care Cosmetics 2016 20 $ 1.0002000 $ 800.000 $ 800 000 2017 82 1.000.000 9104000 2018 1,100.000 600.000 6004000 2019 89 1,150,000 600.000 7004000 94 1.2007000 700.000 202 1 96 1.250.000 700,0OO 100 1.300.000 600.000 9002000 Required: (Round your answers to 2 decimal places.) 1. Compute return on investment (ROl) for each division using the historical cost of divisional assets (including current assets) as the investment bose 2. Compute ROI for each division, incorporating current-cost estimates as follows: . Gross book value (GBV) of long-lived assets plus book value of current assets. b. GBV of long-lived assets restated to current cost using the index of construction costs plus book value of current assets. (Do not round Intermediate calculations. Round dollar values to the nearest whole dollar.) c. Net book value (NBV) of long-lived assets restated to current cost using the index of construction costs plus book value of current assets. (Do not round Intermediate calculations. Round dollar values to the nearest whole dollar.) d. Current replacement cost of long-lived assets plus book value of current assets e. Current liquidation value of long-lived assets plus book value of current assets. Health Care Coametice Retum an investment based on historical cost of divisional assets 23. Return an investment based an Das book value 2b. Retum an investment based on n gross book value at current cost 2c Retum an Inv net book value at current cast 2d. Return on investment based on current replacement cost 2c. Retum on investment based on current liquidation value

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