Zuds, a national manufacturer of lawn-mowing and snow-blowing equipment, segments its business according to customer type: Professional and Residential. Assume the following divisional information was available for the past year (in thousands of dollars):

Requirement 1. Calculate each division's ROI. First enter the formula, then calculate each division's ROI using the expanded formula (1) (2) ROI Residential % Professional Interpret your results. Each division's ROI is (3) however, the (4) has an even higher ROI than the (5) Requirement 2. Calculate each division's sales margin. Interpret your results. First enter the formula, then calculate each division's sales margin. (6) (7) Sales margin Residential Professional - Interpret your results. The Professional Division is earning about (8) on each dollar of sales whereas the Residential Division is only earning about (9) on each dollar of sales. The (10) higher sales margin helps to account for its higher ROI. Requirement 3. Calculate each division's capital turnover. Interpret your results. First enter the formula, then calculate each division's capital turnover. (Round your answer to two decimal places.) (11) (12) Capital turnover Residential times Professional times Interpret your results. The Professional Division is generating about (13). of sales for every dollar of assets. The Residential Division is generating about (14) of sales for each dollar of assets invested. The (15) is more efficient. Requirement 4. Use the expanded ROI formula to confirm your results from Requirement 1. What can you conclude? First enter the expanded formula, then calculate each division's ROI using the expanded formula (16) (17) ROI Residential % % Professional % X % Confirm your results from Requirement 1. Does your answer for the residential ROI agree with the basic ROI? (18). Does your answer for the professional ROI agree with the basic ROI? (19) What can you conclude? Even though the (20). efficiency (as measured by the capital turnover) is higher than that of the (21). the (22) profitability (as measured by the sales margin) is so much higher that it causes its ROI to be much higher than the (23) Requirement 5. Calculate each division's residual income (RI). Interpret your results First enter the formula, then calculate each divisions RI. (24) (25) x (26) = RI Res. X %) = Prof. Interpret your results. (27) exceeding management's expectations