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Selected sales and operating data for three divisions of different structural engineering firms are given as follows: Division B Division A Division C Sales $5,200,000
Selected sales and operating data for three divisions of different structural engineering firms are given as follows: Division B Division A Division C Sales $5,200,000 9,200,000 $8,300,000 $1,300,000 $4,600,000 $2,075,000 Average operating assets 223,600 763,600 128,650 Net operating income 10.00% 16.60% 7.00% Minimum required rate of return Required: 1. Compute the return on investment (ROI) for each division using the formula stated in terms of margin and turnover. (Round your answers to 2 decimal places.) ROI Margin Turnover 17.20 Division A Division B Division C 2. Compute the residual income (loss) for each division. (Loss amounts should be indicated by a minus sign. Round your "Required rate of return" to 2 decimal places.) Division A Division B Division C Average operating assets Required rate of return Required operating income Actual operating income Required operating income (above) Residual income (loss)
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