Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Required information Exercise 10-13 Effects of Changes in Sales, Expenses, and Assets on ROI (L010-1) [The following information applies to the questions displayed below] CommercialServices.com

image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
Required information Exercise 10-13 Effects of Changes in Sales, Expenses, and Assets on ROI (L010-1) [The following information applies to the questions displayed below] CommercialServices.com Corporation provides business-to-business services on the Internet. Data concerning the most recent year appear below: $ Sales Net operating income Average operating assets 3,560,000 284,800 890,000 5 Exercise 10-13 Part 1 Required: 1 Compute the company's return on investment (ROI). (Do not round intermediate calculations, Round your answer to 2 decimal places.) Run on investment IRON Exercise 10-13 Part 2 2. The entrepreneur who founded the company is convinced that sales will increase next year by 60% and that net operating income will increase by 200%, with no increase in average operating assets. What would be the company's ROI? (Do not round Intermediate calculations. Round your answer to 2 decimal places.) Return on investment (ROI) Exercise 10-13 Part 3 3. The Chief Financial Officer of the company believes a more realistic scenario would be a $1700,000 increase in sales, requiring a $162,000 increase in average operating assets, with a resulting $138,450 increase in net operating income. What would be the company's ROI in this scenario? (Do not round intermediate calculations, Round your answer to 2 decimal places.) Return on investment (RON

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Students also viewed these Accounting questions