Use the information provided in the annual report of Matlock Industries to answer the following questions.

Choose the correct answer from the options provided. Round your intermediate figures to two decimal places.

Sales revenue	$	560,000
Less: Operating expenses		364,000
Net operating income	$	196,000
Average invested assets	$	450,000

What is Matlock's investment turnover?

multiple choice 1

• 1.44

• 1.87

• 1.24

• 0.81

Calculate Matlock's profit margin.

multiple choice 2

• 44 percent

• 24 percent

• 81 percent

• 35 percent

What is Matlock's return on investment? (Hint: Obtain the answer by multiplying the two component ratios together.)

multiple choice 3

• 35 percent

• 24 percent

• 81 percent

• 43 percent

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Sales revenue	$	1,120,000
Less: Operating expenses		784,000
Net operating income	$	336,000
Average invested assets	$	950,000

If Wickham has a hurdle rate of 20 percent, what is its minimum acceptable profit?

multiple choice 1

• $336,000

• $190,000

• $784,000

• $146,000

Assuming again that Wickham has a hurdle rate of 20 percent, calculate its residual income.

multiple choice 2

• $784,000

• $146,000

• $336,000

• $190,000