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Selected sales and operating data for three divisions of different structural engineering firms are given below: Net operating income Division A $ 12,440,000 Division
Selected sales and operating data for three divisions of different structural engineering firms are given below: Net operating income Division A $ 12,440,000 Division B $ 35,550,000 $ 3,110,000 $ 547,360 10.00% $ 7,110,000 $ 639,900 10.50% Division C $ 25,550,000 $ 5,110,000 $740,950 14.50% Sales Average operating assets Minimum required rate of return Required: 1. Compute each division's margin, turnover, and return on investment (ROI). 2. Compute each division's residual income (loss). 3. Assume each division is presented with an investment opportunity yielding a 11% rate of return. a. If performance is being measured by ROI, which division or divisions will accept the opportunity? b. If performance is being measured by residual income, which division or divisions will accept the opportunity? Complete this question by entering your answers in the tabs below. Req 1 Req 2 Req 3A Req 38 Compute each division's margin, turnover, and return on investment (ROI). Note: Do not round intermediate calculations. Round your answers to 2 decimal places. Margini Turnover Division A Division B % % ROI % Complete this question by entering your answers in the tabs below. Req 1 Req 2 Req 3A Req 3B Compute each division's residual income (loss). Note: Do not round intermediate calculations, Loss amounts should be indicated by a minus sign. Division A Division B Division C Residual income (loss) 1. Compute each division's margin, turnover, and return on investment (ROI). 2. Compute each division's residual income (loss). 3. Assume each division is presented with an investment opportunity yielding a 11% rate of return. a. If performance is being measured by ROI, which division or divisions will accept the opportunity? b. If performance is being measured by residual income, which division or divisions will accept the opportunity? Complete this question by entering your answers in the tabs below. Req 1 Req 2 Req 3A Req 38 Assume each division is presented with an investment opportunity yielding a 11% rate of return. If performance is being. measured by ROI, which division or divisions will accept or reject the opportunity? Division A Division B Division C 1. Compute each division's margin, turnover, and return on investment (ROI). 2. Compute each division's residual income (loss). 3. Assume each division is presented with an investment opportunity yielding a 11% rate of return. *a. If performance is being measured by ROI, which division or divisions will accept the opportunity? b. If performance is being measured by residual income, which division or divisions will accept the opportunity? Complete this question by entering your answers in the tabs below. Req 1 Req 2 Req 3A Req 38 Assume each division is presented with an investment opportunity yielding a 11% rate of return. If performance is being measured by residual income, which division or divisions will accept or reject the opportunity? Division A Division B Division C
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