Gaal Industries is a division of a major corporation. Last year the division had
ID: 2392067 • Letter: G
Question
Gaal Industries is a division of a major corporation. Last year the division had total sales of $27,311,900, net operating income of $2,840,438, and average operating assets of $7,094,000. The company's minimum required rate of return is 15%. Required a. What is the division's margin? (Round your answer to 2 decimal places.) Division's Margin b. What is the division's turnover? (Round your answer to 2 decimal places.) Division Turnover c.What is the division's return on investment (ROI)? (Round your answer to 2 decimal places.) Return on Investment (ROI)Explanation / Answer
a. Margin = Net Operating Income / Sales *100
= $ 2840438 / 27311900 *100
= 10.40%
Hence, the correct answer is 10.40%
b. Turnover= Sales / Average Operating Assets
= $ 27311900 / $ 7094000
= 3.85
Hence, the correct answer is 3.85
c. ROI = Net Operating Income / Average Operating Assets *100
= $ 2840438/ $ 7094000 *100
= 40.04%
Hence, the correct answer is 40.04%
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