The contribution format income statement for Huerra Company for last year is given below: $ Sales Variable expenses Contribution margin Pixed expenses Net operating income Income taxes 401 Net incone Total 992.000 595,200 396,800 314,800 32,600 32.800 49,200 Unit $49.60 29.76 19.84 15.74 4.10 1.64 $ 2.46 $ The company had average operating assets of $494,000 during the year. Required: 1. Compute the company's return on investment (ROI) for the period using the ROI formula stated in terms of margin and turnover. For each of the following questions, indicate whether the margin and turnover will increase, decrease, or remain unchanged as a result of the events described, and then compute the new ROI figure. Consider each question separately, starting in each case from the data used to compute the original ROI in (1) above. 2. Using Lean Production, the company is able to reduce the average level of inventory by $104,000. (The released funds are used to pay off short-term creditors.) 3. The company achieves a cost savings of $6,000 per year by using less costly materials. 4. The company issues bonds and uses the proceeds to purchase machinery and equipment that increases average operating assets by $122.000. Interest on the bonds is $19,000 per year. Sales remain unchanged. The now, more efficient equipment reduces production costs by $5,000 per year. 5. As a result of a more intense effort by sales people, sales are increased by 15% operating assets remain unchanged. 6. At the beginning of the year, obsolete inventory carried on the books at a cost of $17,000 is scrapped and written off as a loss 7. At the beginning of the year, the company uses $183,000 of cash received on accounts receivable) to repurchase and retire some of its common stock Answer is not complete Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Required 5 Compute the company's return on investment (ROI) for the period using the ROI formula stated in terms of margin and turnover. (Round your intermediate calculations and final answer to 2 decimal places For each of the following questions, indicate whether the margin and turnover will increase, decrease, or remain unchanged as of the events described, and then compute the new ROI figure. Consider each question separately, starting in each case from th used to compute the original ROI in (1) above. 2. Using Lean Production, the company is able to reduce the average level of inventory by $104,000. (The released funds are us pay off short-term creditors.) 3. The company achieves a cost savings of $6.000 per vear by using less costly materials. 4. The company issues bonds and uses the proceeds to purchase machinery and equipment that increases average operating as by $122,000. Interest on the bonds is $19,000 per year. Sales remain unchanged. The new, more efficient equipment reduces production costs by $5,000 per year. 5. As a result of a more intense effort by sales people, sales are increased by 15%; operating assets remain unchanged. 6. At the beginning of the year, obsolete inventory carried on the books at a cost of $17.000 is scrapped and written off as a loss. 7. At the beginning of the year, the company uses $183,000 of cash (received on accounts receivable) to repurchase and retire so of its common stock. Answer is not complete. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Required 5 Required 6 Required 7 Using Lean Production, the company is able to reduce the average level of inventory by $104,000. (The released funds are used to pay off short-term creditors.) (Round your intermediate calculations and final answer to 2 decimal places.) 8.27 % Margin Tumover ROI Effect Unchanged Increase Increase | 19.73 % Income taxes e 404 Net income 32,800 49,200 $ $ 2.46 The company had average operating assets of $494,000 during the year Required: 1. Compute the company's return on investment (ROI) for the period using the ROI formula stated in terms of margin and turnover For each of the following questions, indicate whether the margin and turnover will increase, decrease, or remain unchanged as a result of the events described, and then compute the new ROI figure. Consider each question separately, starting in each case from the data used to compute the original ROI in (1) above. 2. Using Lean Production, the company is able to reduce the average level of inventory by $104,000. (The released funds are used to pay off short-term creditors.) 3. The company achieves a cost savings of $6,000 per year by using less costly materials. 4. The company issues bonds and uses the proceeds to purchase machinery and equipment that increases average operating assets by $122.000. Interest on the bonds is $19.000 per year. Sales remain unchanged. The new, more efficient equipment reduces production costs by $5,000 per year. 5. As a result of a more intense effort by sales people, sales are increased by 15%; operating assets remain unchanged. 6. At the beginning of the year, obsolete inventory carried on the books at a cost of $17.000 is scrapped and written off as a loss. 7. At the beginning of the year, the company uses $183,000 of cash (received on accounts receivable) to repurchase and retire some of its common stock. Answer is not complete. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Required 5 The company achieves a cost savings of $6,000 per year by using less costly materials. (Round your intermediate calculations and final answer to 2 decimal places.) Ellect 58 % Margin Tumover increase unchanged 200 ROS