1. What type of responsibility centre best describes each of the following, and why? (3 marks)
   1. The cleaning department of Melbourne Private Hospital Ltd.
   2. The reservations division of Rosie Transport Tours Ltd
   3. The Singapore division of a global video technology company, whose head office is in Sydney.
2. Fishy and Chippy Ltd operates a chain of restaurants in Perth, South Australia. The head office reviewed information about two of its restaurants - i.e. Restaurant Alpha and Restaurant Gamma (see below). Each restaurant operates as a separate stand-alone business and is designated as an investment centre. (8 marks)

	Restaurant Alpha	Restaurant Gamma
Sales	$900 000	$805 000
Cost of goods sold	$495 000	422 500
Operating expenses	$350 000	300 000
Profit	$55 000	$82 500
Average invested capital	$350 000	$500 000
ROI	?	?
RI	?	?

Required:

1. Calculate the financial performance of each restaurant using both ROI and RI. Assume the firm's minimum required rate of return is 13%. (4 marks)
2. Which restaurant performed better? Explain

Suggest two ways the poor-performing restaurant can improve its performance in the future