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[The following information applies to the questions displayed below.] Westerville Company reported the following results from last years operations: Sales $ 1,400,000 Variable expenses 510,000

[The following information applies to the questions displayed below.]

Westerville Company reported the following results from last years operations:

Sales $ 1,400,000
Variable expenses 510,000
Contribution margin 890,000
Fixed expenses 610,000
Net operating income $ 280,000
Average operating assets $ 875,000

This year, the company has a $175,000 investment opportunity with the following cost and revenue characteristics:

Sales $ 280,000
Contribution margin ratio 50 % of sales
Fixed expenses $ 98,000
The companys minimum required rate of return is 15%.
5.

What is the turnover related to this years investment opportunity? (Round your answer to 1 decimal place.)

Turnover;

7.

If the company pursues the investment opportunity and otherwise performs the same as last year, what margin will it earn this year? (Round your percentage answer to 1 decimal place (i.e .1234 should be entered as 12.3))

Margin; %

8.

If the company pursues the investment opportunity and otherwise performs the same as last year, what turnover will it earn this year? (Round your answer to 2 decimal places.)

Turnover;

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