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Westerville Company reported the following results from last year's operations: Sales Variable expenses Contribution margin Fixed expenses Net operating income $ 1,500,000 730,000 770,000
Westerville Company reported the following results from last year's operations: Sales Variable expenses Contribution margin Fixed expenses Net operating income $ 1,500,000 730,000 770,000 470,000 $ 300,000 Average operating assets $ 937,500 At the beginning of this year, the company has a $362,500 investment opportunity with the following cost and rever characteristics: Sales $ 580,000 Contribution margin ratio 70 % of sales $ 319,000 Fixed expenses The company's minimum required rate of return is 10%. 7. If the company pursues the investment opportunity and otherwise performs the same as last year, what margin will it earn this year? (Round your percentage answer to 1 decimal place (i.e., 0.1234 should be entered as 12.3).)
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