The president feels very strongly that Mountain Sports should expand operations to a second location. She has even found a prime location in Canmore, Alberta, One of the great things about Canmore is its proximity to the mountains, and its only about 10 minutes away from this beautiful, vibrant and internationally known Banff tourist town. Research indicates that the Canmore market is well suited to both cross-country skis and bikes that competition is fairly limited. The investment in assets (cash, inventory, equipment) required for the new location is $ 206,000 Minimum required return on investments 18% Actual 2019 return on investment of the original location 24% - Management has provided the following income statement to the bank manager the expected net income in the Static Budget % Amount o Sales in Units 4,048 1 Sales 506,000 100% 2 Less: Variable Costs: 3 Cost of Goods Sold 216,000 43% 4 Sales Commissions 55,660 11% 6 Total Variable Costs 271,660 54% 6 Contribution Margin 234,340 46% 7 Less: Fixed Costs: Advertising 21,000 9 Property Taxes 9,000 0 Rent 42,000 1 Salaries & Wages 108,000 2 Total Fixed Costs 180,000 3 Net Operating Income 54,340 4 5 Part A: (4 marks) Calculate the following performance measurements for the proposed Canmore expansion: 6 Margin 7 8 8 Turnover (use investment in assets in equation) Part A: (4 marks) Calculate the following performance measurements for the proposed Canmore expansion: Margin Turnover (use investment in assets in equation) Return on Investment Residual Income 3 Part B: Analysis (6 marks)Explain in your own words using case data. Marks will not be awarded for textbook definitions). a. If management is evaluated based on ROI, will the project be accepted (expansion into Canmore)? Whyo not? b. What is the major weakness of using return on investment as a performance measure? Is there anything could recommend to the owners to mitigate this weakness of using ROI as a performance measure