Zoes, a national manufacturer of lawn mowing and snow-blowing equipment, segments its business according to customer lype professional and residential. The following divisional information was available for the past year: (Click the icon to view the information) Read the requirements Requirement 1. Calculate each division's ROI. Round all of your answers to four decimal places Begin by selecting the formula to calculate return on investment (ROI), and then enter the amounts to colate each division's ROL (Enter your answer as a percent rounded to two decimal places, XXX%) ROI Residential Professional Requirement 2. Calculate each division's profit margin ratio. Interpret your results. Begin by selecting the formula to calculate profit margin ratio, and then enter the amounts to calculato each division's profit margin ratio (Enter each profit margin ratio as a percent rounded to two decimal places, X.XX%) = Profit margin ratio Residential Professional The residential division is earning about of operating income on each dollar of net sales revenue whereas the professional division is earning about $ of operating income on each dolar of net sales revenue. The higher profit margin ratio helps to account for its higher ROL Requirement 3. Calculate each division's asset turnover ratio. Interpret your results. (Round your answer to two decimal places, XOC) = Asset tumover ratio Residential Choose from any list or enter any number in the input fields and then continue to the next question Requirement 3. Calculate each division's asset turnover ratio. Interpret your results. (Round your answer to two decimal places, XXX) - Asset turnover ratio Residential Professional The residential division is generating about of net sales revenue for each dollar of average total assets invested. The professional division is generating about of net sales revenue for every dollar of average total assets. The is more efficient Requirement 4. Use the expanded ROI formula to confirm your results from Requirement 1. What can you conclude? (Enter your answers as a percent rounded to two decimal places, X.XX%.) First, select the expanded ROI formula. - ROI The ROI for the residential division is L Does your answer above agree with the basic ROI for the residential division you calculated in Requirement 1? The ROI for the professional division is % Does your answer above agree with the basic ROI for the professional division you calculated in Requirement 17 Choose from any list or enter any number in the input fields and then continue to the next question. A Data Table Residential Professional Net Sales Revenue Operating Income Average Total Assets $ 570,000 $ 59,150 $ 182,000 1,080,000 160,800 402,000 Management has a 25% target rate of return for each division. Print Done Henderson Company manufactures electronics, The Calculator Division (an investment center) manufactures handheld calculators. The division can purchase the batteries used in the calculators from the Battery Division (another investment center) or from an outside vendor. The cost to purchase batteries from the outside vendor is $5. The transfer price to purchase from the Battery Division is $6. The Battery Division also sells to outside customers. The sales price is $6, and the variable cost is $3. The Battery Division has excess capacity. Read the requirements. Requirement 1. Should the Calculator Division purchase from the Battery Division or the outside vendor? O A. The Calculator Division should purchase from the Battery Division as long as the transfer price is $6.00 or less because the Battery Division has excess capacity. O B. The Calculator Division should purchase from the Battery Division as long as the transfer price is $5.00 or less because the Battery Division has excess capacity. O C. The Calculator Division should purchase from the outside vendor as long as the transfer price is $3.00 or more because the Battery Division is operating at capacity OD. The Calculator Division should purchase from the outside vendor as long as the transfer price is $5.00 or less because the Battery Division has excess capacity. Requirement 2. If Henderson Company allows division managers to negotiate transfer prices, what is the maximum transfer price the manager of the Calculator Division should consider? The maximum transfer price the Calculator Division should consider is Requirement 3. What is the minimum transfer price the manager of the Battery Division should consider? The minimum transfer price the Battery Division should consider is Requirement 4. Does your answer to Requirement 3 change if the Battery Division is operating at capacity? If the Battery Division is operating at capacity, the minimum transfer price should be Decentralization divides company operations into various reporting units. Most decentralized subunits can be described as one of four different types of responsibility centers. Requirements 1. Explain why companies decentralize. Describe some typical methods of decentralization 2. List the four most common types of responsibility centers, and describe their responsibilities Requirement 1. Explain why companies decentralize. Describe some typical methods of decentralization to manage the entire organization's daily Companies usually decentralize when they operations Decentralization is often based on Requirement 2. List the four most common types of responsibility centers, and describe their responsibilities. Responsibility centers Description of responsibilities N The accountant for a subunit of Speed Sports Company went on vacation before completing the subunit's monthly responsibility report. This is as far as she got: (Click the icon to view the responsibility report.) Read the requirements. Flexible Budget Sales Volume Variance $ 19,000 F Requirement 1. Complete the responsibility report for this subunit. Speed-Subunit X Actual Flexible Budget Revenue by Product Results Variance Downhill-RI $ 324,000 Downhill-RII 160,000 D O Cross-EXI 286,000 5,000 U Cross-EXII 259,000 Snow-LXI 430,000 7,000 $ Total 1,459,000 172,000 291,000 253,000 Static Budget $ 298,000 151,000 306,000 269,500 405,000 $ 1,429,500 16,500 U L R Requirement 2. Based on the data presented what type of responsibility center is this subunit? Requirement 3. Which items should be investigated if part of management's decision criteria is to investigate all variances exceeding $13,000? (Leave any unused cells blank.) Using the flexible budget variance as a guide, the following items will be investigated: sy Choose from any list or enter any number in the input fields and then continue to the next question. pe here to search The accountant for a subunit of Speed Sports Company went on vacation before completing the subunit's monthly responsibility report. This is as far as she got: Click the icon to view the responsibility report.) 430.UUU 7,000 Read the requirements. Snow-LXI Total $ 405,000 1,459,000 $ 1,429,500 Requirement 2. Based on the data presented what type of responsibility center is this subunit? Requirement 3. Which items should be investigated if part of management's decision criteria is to investigate all variances exceeding $13,000? (Leave any unused cells blank.) Using the flexible budget variance as a guide, the following items will be investigated: Using the sales volume variance as a guide, the following items will be investigated: Choose from any list or enter any number in the input fields and then continue to the next question. Sales Volume Variance $ 19,000 F $ Speed-Subunit X Revenue by Product Downhill-RI Downhill-RII Cross-EXI Cross-EXII Snow-LXI $ Actual Flexible Budget Results Variance 324,000 160,000 (c) 286,000 $ 5,000 U 259,000 430,000 7,000 F 1,459,000 (0) Flexible Budget (b) 172,000 291,000 253,000 (9) Static Budget 298,000 151,000 306,000 269,500 405,000 1,429,500 (e) 16,500 U (h) Total $ (k) $ Print [Done] Print Done Well-designed performance evaluation systems accomplish many goals. Describe the potential benefits performance evaluation systems offer. Well-designed performance evaluation systems offer companies many benefits. Management uses performance evaluation systems to do the following