Westerville Company reported the following results from last years operations:

Sales	$	1,200,000
Variable expenses		420,000
Contribution margin		780,000
Fixed expenses		600,000
Net operating income	$	180,000
Average operating assets	$	600,000

This year, the company has a $137,500 investment opportunity with the following cost and revenue characteristics:

Sales	$	220,000
Contribution margin ratio		60	% of sales
Fixed expenses	$	99,000

The companys minimum required rate of return is 20%.

rev: 04_28_2016_QC_CS-49731

1.

value: 1.00 points

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Required:

1.	What is last years margin? %

2.

value: 1.00 points

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2.	What is last years turnover? (Round your answer to 1 decimal place.)

3.

value: 1.00 points

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3.	What is last years return on investment (ROI)?%

4.

value: 1.00 points

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4.	What is the margin related to this years investment opportunity?%

5.

value: 1.00 points

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5.	What is the turnover related to this years investment opportunity? (Round your answer to 1 decimal place.)

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value: 1.00 points

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6.	What is the ROI related to this years investment opportunity? %

7.

value: 1.00 points

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11.	What is last years residual income?

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value: 1.00 points

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12.	What is the residual income of this years investment opportunity?

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value: 1.00 points

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14.

If Westervilles chief executive officer will earn a bonus only if her residual income from this year exceeds her residual income from last year, would she pursue the investment opportunity?

	No
	Yes