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While reviewing last year's performance outcomes for comparison to this year, Jennifer finds several pieces are missing. Apparently, a virus attacked select components of
While reviewing last year's performance outcomes for comparison to this year, Jennifer finds several pieces are missing. Apparently, a virus attacked select components of the system's memory, and the back-up information was too difficult to extract from the file. She knows that all three divisions use the corporate tax rate (26%), minimum rate of return (10%), and WACC (8%) to determine their respective RI and EVA metrics. The following information reflects the components that Jennifer could identify for each of the three divisions in the company. Industrial Technology Service Sales $125,000 G M Operating income $9,000 $19,200 N After-tax operating income A H $15,540 Operating assets $80,000 | Total assets $100,000 $188,000 P Current liabilities $5,000 J $9,000 ROI B 10% RI C K $11,000 EVA Profit margin Asset turnover DE F $2,848 $7,780 L 14.0% 2 R (a) Fill in the missing items (lettered A through R) for each of the three divisions. For ROI calculations, operating assets are considered investments. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45). Round ROI to 2 decimal places, e.g. 15.25%, profit margin to 1 decimal place, e.g. 15.2% and asset turnover to 4 decimal places, e.g. 15.2516.) Sales Operating income After-tax operating income $ Operating assets Total assets Current liabilities ROI Residual income EVA Profit margin Asset turnover +A $ $ Industrial Technology $125,000 $ $9,000 $80,000 $100,000 $5,000 A $ % B C D % E $ +A $ +A $19,200 $188,000 10% $2,848 LL F 2 Service G $ H J $ $ $ $15,540 $9,000 K $11,000 $7,780 % L 14.0% M N P % Q R S
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