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The following data pertain to British Isles Aggregates Company, a producer of sand, gravel, and cement, for the year just ended.

Sales revenue		6,350,000
Cost of goods sold		2,227,000
Operating expenses		3,551,500
Average invested capital		1,587,500

denotes the British pound sterling, the national monetary unit of Great Britain.

1. 3-a. Assuming that the expenses and cost of goods sold are reduced in order to improve the firm's ROI to 40 percent, compute the firm's new sales margin.

2. 3-b. Show how the new sales margin and the old capital turnover together result in a new ROI of 40 percent.

Assuming that the expenses and cost of goods sold are reduced in order to improve the firm's ROI to 40 percent, compute the firm's new sales margin. (Round your answers to 2 decimal places (i.e., .1234 should be entered as 12.34).)

new sales margin: %

Show how the new sales margin and the old capital turnover together result in a new ROI of 40 percent. (Enter "new sales margin" as a percentage rounded to 2 decimal places (i.e., .1234 should be entered as 12.34) and "old capital turnover" to two decimal places.)

new ROI = % x = 40 %