Westerville Company reported the following results from last year’s operations:

Question

Westerville Company reported the following results from last year’s operations:

This year, the company has a $300,000 investment opportunity with the following cost and revenue characteristics:

The company’s minimum required rate of return is 15%.

What is last year’s margin?

2. What is last year’s turnover? (Round your answer to 1 decimal place.)

What is last year’s return on investment (ROI)?

What is the turnover related to this year’s investment opportunity? (Round your answer to 1 decimal place.)

Westerville Company reported the following results from last year’s operations:

Explanation / Answer

Statement showing computations Particulars Amount 1) Last year sales       1,400,000.00 Net Operating Income           280,000.00 Margin in % = 280,000/1,400,000 20.00% 2) Last year sales       1,400,000.00 Average operating assets           875,000.00 Turnover = 1,400,000/875,000                        1.60 3) Return on investment = 280,000/875,000 32.00% 4) This year investment oppurtunity Sales           480,000.00 Contribution = 80%           384,000.00 Fixed Expenses           336,000.00 Net Income = 384,000 - 336,000             48,000.00 Margin in % = 48,000/480,000 10% 5) Investment           300,000.00 Turnover = 480,000/300,000                        1.60

Related Questions

Navigate

• Browse (All)
• Browse W
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.