A family friend has asked your help in analyzing the operations of three anonymo

Question

A family friend has asked your help in analyzing the operations of three anonymous companies operating in the same service sector industry. Supply the missing data in the table below: (Loss amounts should be indicated by a minus sign. Enter your ROl and Rate of Return Percentage answers to the nearest percentage (i.e., 0.12 should be entered as 12).) Company $ 530,000 Sales Net operating income Average operating assets Return on investment (ROI) Minimum required rate of return $440,000 38,640 $ 161,000 $ 720,000 37,000 $ 194,737 $ 157,000 24 % 191% 13% 24 % 101% Percentage Dollar amount 47,000 15,700 Residual income S 10,000)$ 7,000

Explanation / Answer

A B C Sales 440000 720000 530000 Net operating income 38640 37000 22700 Average operating assets 161000 194737 157000 Return on investment(ROI) 24% 19% 14% Minimum required rate of return: Percentage 13% 24% 10% Dollar amount 20930 47000 15700 Residual income 17710 -10000 7000

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