Zooms, a national manufacturer of lawn- mowing and snow- blowing equipment, segments its business according to customer type: professional and residential. The following divisional information was available for the past year:

Management has a 26% target rate of return for each division. 

Requirements 

1. Calculate each division’s ROI. Round all of your answers to four decimal places. 

2. Calculate each division’s profit margin ratio. Interpret your results. 

3. Calculate each division’s asset turnover ratio. Interpret your results. 

4. Use the expanded ROI formula to confirm your results from Requirement 1. What can you conclude?

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Net Sales Residential 520,000 Professiona ,020,000 Operating Income 64,320 158,760 Average Total Assets $ 192,000 392,000