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Selected sales and operating data for three divisions of three different companies are given below: Division A Division B Division C Sales $6,000,000 $10,000,000 $8,000,000
Selected sales and operating data for three divisions of three different companies are given below: Division A Division B Division C Sales $6,000,000 $10,000,000 $8,000,000 Average operating assets $1,500,000 $5,000,000 $2,000,000 Net operating income $300,000 $900,000 $180,000 Minimum required rate of return 15 % 18 % 12 % Required: 1. Compute the return on investment (ROI) for each division, using the formula stated in terms of margin and turnover. Division A Division B Division C %? 2.Compute the residual income for each division
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