Compute the Springfield club’s return on investment (ROI). (Do not round interme

Question

Compute the Springfield club’s return on investment (ROI). (Do not round intermediate calculations. Round your answer to 2 decimal places.)

Assume that the manager of the club is able to increase sales by $89,000 and that, as a result, net operating income increases by $7,921. Further assume that this is possible without any increase in average operating assets. What would be the club’s return on investment (ROI)? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

Assume that the manager of the club is able to reduce expenses by $3,560 without any change in sales or average operating assets. What would be the club’s return on investment (ROI)? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

Assume that the manager of the club is able to reduce average operating assets by $50,000 without any change in sales or net operating income. What would be the club’s return on investment (ROI)? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

Required information The following information applies to the questions displayed below. Fitness Fanatics is a regional chain of health clubs. The managers of the clubs, who have authority to make investments as needed, are evaluated based largely on return on investment (ROI). The company's Springfield Club reported the following ar. Sales Net operating income Average operating assets 890,000 $ 30,260 100,000

Explanation / Answer

1 Return on investment = 30260/100000 = 30.26% 2 Return on investment = (30260+7921)/100000 = 38.18% 3 Return on investment = (30260+3560)/100000 = 33.82% 4 Return on investment = 30260/(100000-50000) = 60.52%

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