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The following information provided by Golden Windows Inc on Dec.31 2018 . Sales 1,940,000 Operating expenses 980,000 Average Operating assets 3,950,000 Required Rate of Return

The following information provided by Golden Windows Inc on Dec.31 2018.

Sales

1,940,000

Operating expenses

980,000

Average Operating assets

3,950,000

Required Rate of Return

21%

Instructions:

  1. Calculate Margin, Turnover and Return on Investment.
  2. Calculate Residual Income.

Silver Windows Inc. planning to increase Average Operating Assets $500,000 during 2019. The estimations of managerial accountant that this investment will increase Net Sales by 60% and Operating Expenses 20%. Do you recommend this investment? Show your calculations

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