THE WHOLE LIFE BAKED GOODS COMPANY Divisional Income Statements For the Year Ended June 30, 20Y7 14 1. 15 16 17 18 19 Cereal Division Cake Division Retall Bakeries Division Sales Cost of goods sold Gross proft Operating expenses Income from operations 2. Retum on Investment (ROIProfit Margin x Investment Tumover Income from Operations Sales Sales Invested Assets Retum on Investment (ROI) Cereal Division: ROI Snack Cake Division: ROI = Retail Bakeries Division: ROI = Key essay answer here] Pr. 24-3A PR 24-3A Divisional income statements and return on investment The Whole Life Baked Goods Company is a diversified food co ent analysis company that specializ centers. Condensed data taken from the records of the three divisions June 30, 20Y7, are as follows: he three in all natural foods. The company has three operating divisioy that for the year endlu cereal Retail Snack Cake Division Bakeries Division Division59,520,000 Division 17,600,000 $18,000,000 Sales Cost of goods sold Operating expenses Invested assets 0,600,000 12,550,000 6,120,000 4,730,000 8,000,000 6,000,000 6,630,000 2,318,800 6,800,000 2 The management of The Whole Life Baked Goods Company is evaluati sion as a basis for planning a future expansion of operations. Instructions 1. Prepare condensed divisional income statements for the three divisions, a ssuming that there were no service department charges. 2. Using the DuPont formula for return on investment, compute the profit margin, invest 8 ment turnover, and return on investment for each division. Round percentages and the investment turnover to one decimal place. 3.If available funds permit the expansion of operations of only one division, which of the divisions would you recommend for expansion, based on parts (1) and (2? Explain