The contribution format income statement for Huerra Company for last year is given below: The company had average operating assots of 5497,000 during the yeor Required: 1. Compute the company's margin, tumover, and retum on investment (RO) for the period. For each of the following questions, indicate whether the margin and tumover wal increase, decrease, or remain unchanged as a resuit of the events described, and then compute the new Rol fipure. Consider each question sepscatey, starting in each case from the data used to compute the original ROI in (b) obove. 2. Using Lean Production, the company is able to reduce the average level of inventory by 592,000 . 3. The company achioves a cost sivings of 57000 per yoar by using less costly materials 4, The company purchases machinery and equipment that increases average operating assets by $129.000. Sales temain unchanged The new, more efficient equipment reduces production costs by $6,000 per year 5. As a result of a more intense efont by sales people, sales are increased by t5\% operating assets remain unchanged. 6. At the beginning of the year, obsolete imventory carried on the books at a cost of $15,000 is seropped and writen of as a loss. thereby lowering net operating income. 7 . At the beginning of the yeac, the company uses $179,000 of cash (recelved on accounts recelvable) to repurchase same of its common stock. Complete this question by entering your answers in the tabs below. Compute the company's margin, turnover, and return on investment (ROI) for the period, (Round your intermediate calculations and final answer to 2 decimal places.) Using Lean Production, the company is able to reduce the average level of inventory by $92,000. (Round your intermediote calculations and final answer to 2 decimal places.) The company achieves a cost savings of $7,000 per year by using less costly materials. (Round your intermediate caiculations and final answer to 2 decimal places.) The company purchases machinery and equipment that increases average operating assets by $129,000, Sales remain unchanged. The new, more efficient equipment reduces production costs by $6,000 per year, (Do not round intermediate. calculations and round your final answers to 2 decimal ploces.) Complete this question by entering your answers in the tabs below. As a result of a more intense effort by sales people, sales are increased by 15\%; operating assets remain unchonged. (Round your intermediate calculations and final answer to 2 dedimal places.) At the beginning of the year, obsolete inventory carried on the books at a cost of $15,000 is scrapped and written off as a loss, thereby lowering net operating income, (Pound your intermediate calculations and final answer to 2 decimal places.) Complete this question by entering your answers in the tabs below. At the beginning of the year, the company uses $179,000 of cash (received on accounts receivable) to repurchase some of its common stock. (Round your intermediate calculations and final answer to 2 decimal places.)
