Solano Company has sales of $620,000, cost of goods sold of $430,000, other operating expenses of 51,000, average invested assets of $1,900,000, and a hurdle rate of 10 percent Required 1 Determine Solanos return on investment (ROI), investment turnover, profit margin, and residual income (Loss amounts should be indicated by a minus sign Do not round your intermediate calculations Round your Investment Turnover answer to 4 decimal places and Return on Investment answer to 1 decimal place and Profit margin answer to 2 decimal places ) 2 Several possible changes that Solano could face in the upcoming year follow Determine each scenarios impact on Solanos ROI and residual income (Note Treat each scenario independently ) a Company sales and cost of goods sold increase by 30 percent (Do not round your intermediate calculations Round your Return on Investment answer to 2 decimal places ) b Operating expenses decrease by $15,500 (Loss amounts should be indicated by a minus sign Do not round your intermediate calculations Round your Return on Investment answer to 2 decimal places ) c Operating expenses increase by 10 percent (Loss amounts should be indicated by a minus sign Do not round your intermediate calculations Round your Return on Investment answer to 2 decimal places ) d Average invested assets increase by $360,000 (Loss amounts should be indicated by a minus sign Do not round your intermediate calculations Round your Return on Investment answer to 2 decimal places ) e Solano changes its hurdle rate to 16 percent (Loss amounts should be indicated by a minus sign Do not round your intermediate calculations Round your Return on Investment answer to 1 decimal place )

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Solano Company has sales of $620,000, cost of goods sold of $430,000, other operating expenses of 51,000, average invested assets of $1,900,000, and a hurdle

Solano Company has sales of $620,000, cost of goods sold of $430,000, other operating expenses of 51,000, average invested assets of $1,900,000, and a hurdle rate of 10 percent.

Required:
1.	Determine Solanos return on investment (ROI), investment turnover, profit margin, and residual income. (Loss amounts should be indicated by a minus sign. Do not round your intermediate calculations. Round your "Investment Turnover" answer to 4 decimal places and "Return on Investment" answer to 1 decimal place and "Profit margin" answer to 2 decimal places.)

2.	Several possible changes that Solano could face in the upcoming year follow. Determine each scenarios impact on Solanos ROI and residual income. (Note: Treat each scenario independently.)

a.	Company sales and cost of goods sold increase by 30 percent. (Do not round your intermediate calculations. Round your "Return on Investment" answer to 2 decimal places.)

b.	Operating expenses decrease by $15,500. (Loss amounts should be indicated by a minus sign. Do not round your intermediate calculations. Round your "Return on Investment" answer to 2 decimal places.)

c.	Operating expenses increase by 10 percent. (Loss amounts should be indicated by a minus sign. Do not round your intermediate calculations. Round your "Return on Investment" answer to 2 decimal places.)

d.	Average invested assets increase by $360,000. (Loss amounts should be indicated by a minus sign. Do not round your intermediate calculations. Round your "Return on Investment" answer to 2 decimal places.)

e.	Solano changes its hurdle rate to 16 percent. (Loss amounts should be indicated by a minus sign. Do not round your intermediate calculations. Round your "Return on Investment" answer to 1decimal place.)