Question 1 Sunland Decor sells home decor items through three distribution chann

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Question 1 Sunland Decor sells home decor items through three distribution channels-retail stores, the Internet, and catalog sales. Each distribution channel is evaluated as an investment center. Selected results from the latest year are as follows: Retail Stores Internet Sales revenue Variable expenses Direct fixed expenses Average assets Required rate of return $12,015,000 $2,772,000 4,780,000 1,360,000 6,714,000 1,154,400 6,008,800 2,008,100 12% Catalog Sales $3,603,000 2,008,000 986,600 3,001,800 12% 12% Calculate the margin and asset turnover for each of the three distribution channels. (Round answers to 2 decimal places, e.g. 5.12% or 5.12.) Retail Stores Internet Catalog Sales Margin Asset turnover Calculate the ROI for each of the three distribution channels. (Round answers to 2 decimal places, e.g. 5.12%.) Retail Stores Internet Catalog Sales ROI

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Solution 1:

Solution 2:

Computation of Margin and Assets Turnover Particulars Retail Stores Internet Catalog Sales Sales Revenue $12,015,000.00 $2,772,000.00 $3,603,000.00 Variable expenses $4,780,000.00 $1,360,000.00 $2,008,000.00 Direct Fixed Expenses $6,714,000.00 $1,154,400.00 $986,600.00 Net Income $521,000.00 $257,600.00 $608,400.00 Average assets $6,008,800.00 $2,008,100.00 $3,001,800.00 Profit margin (Net Income / Sales) 4.34% 9.29% 16.89% Assets Turnover (Sales / Average Assets) 2.00 1.38 1.20

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