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The company had an overall return on investment (ROI) of 18.00% this year (considering all divisions). Next year the Office Products Division has an opportunity
The company had an overall return on investment (ROI) of 18.00% this year (considering all divisions). Next year the Office Products Division has an opportunity to add a new product line that would require an additional investment that would increase average operating assets by $2,350,000. The cost and revenue characteristics of the new product line per year would be: Sales $ 9,396,500 Variable expenses 65% of sales Fixed expenses $ 2,564,875 Required: 1. Compute the Office Products Divisions margin, turnover, and ROI for this year. 2. Compute the Office Products Divisions margin, turnover, and ROI for the new product line by itself. 3. Compute the Office Products Divisions margin, turnover, and ROI for next year assuming that it performs
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