CengageNow eBook Determining Missing Items in Rate of Return and Residual Income

Question

CengageNow eBook Determining Missing Items in Rate of Return and Residual Income Computations Data for Schmidt Company are presented in the following table of rates of return on investmen t and residual incomes: Minimum Minimum Acceptable Invested Income Rate of Return Rate of Income from Residual Assets from on Investment Return Operations Income Operations $890,000 $195,800 $510,000 $350,000 $260,000 $52,000 Determine the missing values, identified by the letters above. For all amounts, round to the nearest whole number 12% $61,200 $20,400 14% 35,000 0) 12% b. d. h.

Explanation / Answer

Invested asssets O Income from operations P Rate of Return Q Min rate M min acceptable Income N Residual Income R $890,000 $195,800 a 12% b c 510000 d e f 61200 20400 350000 g 14% h 35000 i 260000 52000 j 12% k l Calculation Answer a 195800/890000*100 22 % b 890000*12% $106,800 c 195800-106800 89000 d 61200+20400 81600 e 81600/510000*100 16 % f 61200/510000*100 12 % g 350000*14% 49000 h 35000/350000*100 10% i 49000-35000 14000 j 52000/260000*100 20 % k 12%*260000 31200 l 52000-31200 20800 ROI=Income from operations/Invested assets *100 min acceptable Income N Invested assets*Min rate Residual income=Income from operations-Min acceptabel income

Related Questions

Navigate

• Browse (All)
• Browse C
• Subjects

---

---

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