Waterway Company manufactures a variety of tools and industrial equipment. The company operates through three divisions. Each division is an investment center. Operating data for the Home Division for the year ended December 31, 2020, and relevant budget data are as follows.

		Actual		Comparison with Budget
Sales		$1,399,000		$100,000	favorable
Variable cost of goods sold		680,000		55,000	unfavorable
Variable selling and administrative expenses		126,000		25,000	unfavorable
Controllable fixed cost of goods sold		169,000		On target
Controllable fixed selling and administrative expenses		80,000		On target

Average operating assets for the year for the Home Division were $2,000,000 which was also the budgeted amount.

Compute the expected ROI in 2020 for the Home Division, assuming the following independent changes to actual data. (Round ROI to 2 decimal places, e.g. 1.57%.)

				The expected ROI
(1)		Variable cost of goods sold is decreased by 6%.			%
(2)		Average operating assets are decreased by 20.0%.			%
(3)		Sales are increased by $200,000, and this increase is expected to increase contribution margin by $84,000.			%

Favorable Unfavorable Neither Favorable nor Unfavorable Budget Actual olid Sales Selling and Administrative Cost of Goods Sold Controllable Margin Total Variable Costs Total Controllable Direct Fixed Costs Variable Costs Contribution Margin Controllable Direct Fixed Costs Gross Profit All Rights Reserved. A Division of John Wiley & Sons, Inc