Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Zorah, a national manufacturer of lawn mowing and snow-blowing equipment, segments its business according to customer type: Professional and Residential Assume the following divisional information

image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
Zorah, a national manufacturer of lawn mowing and snow-blowing equipment, segments its business according to customer type: Professional and Residential Assume the following divisional information was available for the past year (in thousands of dollars); (Click the icon to view the information.) Read the requirements Requirement 1. Calculate each division's ROI. First enter the formula, then calculate each division's ROI using the expanded formula ROI % % Residential Professional Interpret your results. Each division's ROIS however, the Requirement 2. Calcutate each division's sales margin. Interpret your results First enter the formula, then calculate each division's sales margin, has an even higher Fol than the Sales margin % Residential Professional . Interpret your results The Professional Division in earning about on each dollar of sales whereas the Residential Division is only oaming about The higher sales margin helps to account for its higher ROI on each dollar of sales Requirement 3. Calculate each division's capital turnover. Interpret your results First enter the formula, then calculate each division's capital tumover (Round your answer to two decimal places.) an P Capital turnover Choose from any list or enter any number in the input fields and then continue to the next question Corah, a national manufacturer of lawn-mowing and snow-blowing equipment, segments its business according to customer type: Professional and Residential assume the following divisional information was available for the past year (in thousands of dollars): (Click the icon to view the information.) Read the requirements Requirement 3. Calculate each division's capital turnover. Interpret your results. First enter the formula, then calculate each division's capital turnover. (Round your answer to two decimal places.) Capital turnover times Residential Professional times Interpret your results V of sales for each The Professional Division is generating about of sales for every dollar of assets. The Residential Division is generating about dollar of assets invested. The is more efficient Requirement 4. Use the expanded ROI formula to confirm your results from Requirement 1. What can you conclude? First enter the expanded formula, then calculate each division's Rol using the expanded formula. ROI % % % % Residential Professional Confirm your results from Requirement 1. Does your answer for the residential ROI agree with the basic ROI? Does your answer for the professional ROI agree with the basic ROI? What can you concludu? Even though the efficiency (as measured by the capital turnover) is higher than that of the P the nrofitability as mansured by the sales marinig an mich hinhar that it caurits ROI to be much hinher than the Choose from any liat or enter any number in the input fields and then continue to the next question Zorah, a national manufacturer of lawn mowing and snow-blowing equipment, segments its business according to customer type: Professional and Residential Assume the following divisional information was available for the past year (in thousands of dollars): Click the icon to view the information) Read the requirements Requirement 4. Use the expanded ROI formula to confirm your results from Requirement 1. What can you conclude? First enter the expanded formula, then calculate each division's ROI using the expanded formula. ROI % Residential Professional X % % Confirm your results from Requirement 1. Does your answer for the residential ROI agree with the basic ROI? Does your answer for the professional ROI agree with the basic ROI? What can you conclude? Even though the efficiency (as measured by the capital turnover) is higher than that of the profitability (an measured by the sales margin) in so much higher that it causes its ROI to be much higher than the the Requirements. Calculate each division's residual income (RI). Interpret your results First enter the formula, then calculate each divisions RI. RI Ros - %) Prof. Interpret your results %) = exceeding management's expectations. Choose from any list or enter any number in the input fields and then continue to the next question. turer of lawn-mowing and snow-blowing equipment, segments its business according to customer ional information was available for the past year (in thousands of dollars): the information.) expanded ROI formula to confirm your results from Requirement 1. What can you conclude? formula, then calculate each division's ROI using the expanded formula. = ROI * Data Table m he he Sales Operating Income Total Assets Residential $ 925,000 $ 64,750 $ 185,000 Professional $ 1,794,000 $ 179,400 $ 390,000 Assume that management has a 26% target rate of return for each division. Print Done higher ulate each division's residual income (RI). Interpret your results

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Effective Writing A For Accountants

Authors: Claire B. May, Gordon S. May

11th Edition

0134667387, 9780134667386

More Books

Students also viewed these Accounting questions

Question

=+b) Find the predicted value for the year 2012. Is it realistic?

Answered: 1 week ago

Question

5. Give some examples of hidden knowledge.

Answered: 1 week ago