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Selected sales and operating data for three divisions of different structural engineering firms are given as follows: Sales Average operating assets Net operating income Division
Selected sales and operating data for three divisions of different structural engineering firms are given as follows: Sales Average operating assets Net operating income Division A Division B Division C $7,000,000 $11,000,000 $10,100,000 $1,750,000 5,500,000 2,525,000 $ 427,000 1,111,000 338,350 required rate of return 20.00% 20.20% 17.00% 1. Compute the return on investment (ROI) for each division using the formula stated in terms of margin and turnover. (Round your Turnover answers to 2 decimal places. Round your Margin and ROI percentage answers to 2 decimal places (i.e., 0.1234 should be entered as 12.34).) 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 percentage answers to 2 decimal places (i.e., 0.1234 should be entered as 12.34).) n B sion c Average operating assets Required rate of return Required operating income Actual operating income Required operating income (above) Residual income (loss) 3. Assume that
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