Solano Company has sales of $$700,000,$ cost of goods sold of $$470,000,$ other operating expenses of $$50,000,$ average invested

assets of $$2,100,000,$ and a hurdle rate of $9$ percent.

Required:

Determine Solano's return on investment $($ROI$),$ investment turnover, profit margin, and residual income.

Several possible changes that Solano could face in the upcoming year follow. Determine each scenario's impact on Solano's ROI

and residual income. $($Note: Treat each scenario independently.$)$

a$.$ Company sales and cost of goods sold increase by $30$ percent.

b$.$ Operating expenses decrease by $$8,000.$

c$.$ Operating expenses increase by $10$ percent.

d$.$ Average invested assets increase by $$400,000.$

e$.$ Solano changes its hurdle rate to $15$ percent.

Answer is not complete.

Complete this question by entering your answers in the tabs below.

Determine Solano's return on investment $($ROI$),$ investment turnover, profit margin, and residual income. $($Loss amounts

should be indicated with a minus sign. Do not round your intermediate calculations. Enter your ROI and Profit Margin

percentage answer to the nearest $2$ decimal places, $($i$.$e$.,0\mathrm{.}1234$ should be entered as $12\mathrm{.}34\%).$ Round your Investment

Turnover answer to $4$ decimal places.$)$

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