Question
The Global Products Corporation has three subsidiaries. Medical Supplies Heavy Machinery Electronics Sales $ 20,750,000 $ 5,220,000 $ 4,160,000 Net income (after taxes) 1,280,000 219,000
The Global Products Corporation has three subsidiaries. |
Medical Supplies | Heavy Machinery | Electronics | ||||
Sales | $ | 20,750,000 | $ | 5,220,000 | $ | 4,160,000 |
Net income (after taxes) | 1,280,000 | 219,000 | 341,000 | |||
Assets | 15,110,000 | 8,510,000 | 3,430,000 | |||
(a-1) | Compute the return on sales? (Round your answers to 2 decimal places. Omit the "%" sign in your response.) |
Return on sales | |
Medical Supplies | % |
Heavy Machinery | % |
Electronics | % |
(a-2) | Which division has the lowest return on sales? | ||||||
|
(b-1) | Compute the return on assets? (Round your answers to 2 decimal places. Omit the "%" sign in your response.) |
Return on assets | |
Medical Supplies | % |
Heavy Machinery | % |
Electronics | % |
(b-2) | Which division has the highest return on assets? | ||||||
|
(c) | Compute the return on assets for the entire corporation. (Round your answer to 2 decimal places. Omit the "%" sign in your response.) |
Return on assets | % |
(d) | If the $8,510,000 investment in the heavy machinery division is sold off and redeployed in the medical supplies subsidiary at the same rate of return on assets currently achieved in the medical supplies division, what will be the new return on assets for the entire corporation? (Round your return on assets to 2 decimal places, return on redeployed assets to the nearest dollar amount and final answer to 2 decimal places. Omit the "%" sign in your response.) |
New return on assets | % |
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started