X ment 1. Calculate each Data table - er the formula, then cal h of a percentage, The company is segmented into five divisions: Paint Stores (branded retail location), Consumer (paint sold through stores such as Home stores Depot and Lowe's), Automotive (sales to auto manufacturers), International, and Administration. The following is selected hypothetical mer divisional information for the company's two largest divisions: Paint Stores and Consumer (in thousands of dollars). irement 2. Calculate each Sales Operating Income Total Assets the formula, then calculat est hundredth of a p Paint Stores . . $ 3,880,000 $ 465,600 $ 1,552,000 Consumer . . . . $ 1,300,000 $ 221,000 $ 2,600,000 t Stores sumer erpret your results. Print Done e Division is r equirement 3. Calculate each division's capital turnover. Interpret your results. First enter the formula, then calculate the capital turnover for each division. (Round to two decimal places.) Capital turnover times Paint StoresProblems Question 1 of 4 > This question: 14 point(s) possible Submit test Chicago Paints is a national paint manufacturer and retailer. EEE (Click the icon to view additional information.) Assume that management has specified a 19target rate of return. Read the requirements. Requirement 6. Total asset data were provided in this problem. If you were to gather this information from an annual report, how would you measure total assets? Describe your measurement choices and some of the pros and cons of those choices. Most companies use the asset balance since the income used in the ROI calculation is earned over the year. Management must also decide whether they wish to use the gross book value of assets or the net book value of assets. The V book value is often used because it is easily pulled from the balance sheet. However, ROI using that value will artificially rise over time due to Requirement 7. Describe some of the factors that management considers when setting its minimum target rate of return. Requirement 8. Explain why some firms prefer to use RI rather than ROI for performance measurement. RI does a better job of Requirement 9. Explain why budget versus actual performance reports are insufficient for evaluating the performance of investment centers. Budget versus actual performance reports are insufficient because they do not measure Investment centers are responsible for Time Remaining: 02:21:55 Next DII DD Q F11 F12 F7 F8 F9 F10(Click the icon to view additional information.) Assume that management has specified a 19target rate of return. Read the requirements. The Division is more efficient in generating sales with its assets. Requirement 4. Use the expanded ROI formula to confirm your results from Requirement 1. Interpret your results. First enter the expanded ROI formula, then calculate the ROI for each division. (Enter the ROI as a percent rounded to the nearest hundredth of a percentage, X.XX%.) RO Paint Stores % 1% Consumer 1% The Consumer Division's profitability on each dollar of sales is than the Paint Stores Division's profitability. However, the Paint Store Division's efficiency is significantly than the Consumer Division's efficiency. These results cause the Paint Stores Division's ROI to be the Consumer Division's ROI. Requirement 5. Calculate each division's RI. Interpret your results and offer recommendations for any division with negative RI. First enter the formula, then calculate the RI for each division. (Enter the amount in thousands. Use parentheses or a minus sign for negative residual incomes.) ( ) = RI Paint Stores % ) = Consumer % = Interpret your results and offer recommendations for any division with negative RI. meeting management's target rate of return. The should work on improving its V. Improving this may help the division achieve positive residual income. Time Remaining: 02:21:59 Next DII DD Q C F11 F12 F10Maryann Hami: 2023FA-BUS-121-1197 - Managerial Accounting P Exam 3: Ch 10-12 Problems Homework Help - Q&A from Online Tutors - Course Hero erial Accounting Maryann Hami 12/09/23 4:19 PM 3: Ch 10-12 Problems Question 1 of 4 This test: 50 point(s) possible This question: 14 point(s) possible Submit test Chicago Paints is a national paint manufacturer and retailer. K EEE(Click the icon to view additional information.) Assume that management has specified a 19target rate of return. Read the requirements. C.. Requirement 1. Calculate each division's ROI. First enter the formula, then calculate the ROI for each division. (Enter the ROI as a percent rounded to the nearest hundredth of a percentage, X.XX%.) ROI Paint Stores % Consumer |% Requirement 2. Calculate each division's sales margin. Interpret your results. Enter the formula, then calculate the sales margin for each division. (Enter the sales margin as a percent rounded to the nearest hundredth of a percentage, X.XX%.) Sales margin Paint Stores % 11 11 1% Consumer Interpret your results. The Division is more profitable on each dollar of sales. Requirement 3. Calculate each division's capital turnover. Interpret your results. First enter the formula, then calculate the capital turnover for each division. (Round to two decimal places.) = Capital turnover times Paint Stores = times Consumer Time Remaining: 02:22:08 Nextssume that management has specified a 19target Read the requ X Requirements Requirement Round all calculations to two decimal places. First enter the 1. Calculate each division's ROI. 2. Calculate each division's sales margin. Interpret your results. 3. Calculate each division's capital turnover. Interpret your results. Paint Stores 4. Use the expanded ROI formula to confirm your results from Requirement 1. Interpret your results. 5 . Calculate each division's RI. Interpret your results and offer recommendations for any division with Consumer negative RI. Requirement 6. Total asset data were provided in this problem. If you were to gather this information from an annual report, how would you measure total assets? Describe your measurement choices and some Enter the form of the pros and cons of those choices. a pe Describe some of the factors that management considers when setting its minimum target rate of return. Paint Stores 8. Explain why some firms prefer to use RI rather than ROI for performance measurement. 9 . Explain why budget versus actual performance reports are insufficient for evaluating the performance Consumer of investment centers. Interpret your The Print Done Requirement First enter the Capital turnover Paint Stores times