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The condensed income statement for the Consumer Products Division of Tri-State Industries Inc. is as follows (assuming no support department charges): Sales $250,000,000 Cost of
The condensed income statement for the Consumer Products Division of Tri-State Industries Inc. is as follows (assuming no support department charges): Sales $250,000,000 Cost of goods sold 121,900,000 Gross profit $128,100,000 Administrative expenses 69,600,000 Operating income $58,500,000 The manager of the Consumer Products Division is considering ways to increase the return on investment. a. Using the DuPont formula for return on investment, determine the profit margin, investment turnover, and return on investment of the Consumer Products Division, assuming that $101,590,000 of assets have been invested in the Consumer Products Division. Round your answers for the profit margin and the rate of return on investment to the nearest whole number, round your answer for the investment turnover to two decimal places. Profit margin % Investment turnover Rate of return on investment % b. If expenses could be reduced by $3,000,000 without decreasing sales, what would be the impact on the profit margin, investment turnover, and return on investment for the Consumer Products Division? Round your answers for the profit margin and the rate of return on investment to the nearest whole number, round your answer for the investment turnover to two decimal places. Profit margin % Investment turnover Date of return on invoctment 0%
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