Exercise 9-1 Compute the Return on Investment (ROI) [LO9-1] Alyeska Services Com

Question

Exercise 9-1 Compute the Return on Investment (ROI) [LO9-1]

Alyeska Services Company, a division of a major oil company, provides various services to the operators of the North Slope oil field in Alaska. Data concerning the most recent year appear below:

Compute the return on investment (ROI) for Alyeska Services Company. (Round your intermediate calculations to 2 decimal places. Round your percentage answer to 2 decimal places (i.e., 0.1234 should be entered as 12.34).)

Alyeska Services Company, a division of a major oil company, provides various services to the operators of the North Slope oil field in Alaska. Data concerning the most recent year appear below:

Explanation / Answer

Margin=Net operating income/Sales

=(5,700,000/17,100,000)=33.33%(Approx)

Turnover=Sales/Average operating assets

=(17,100,000/35,500,000)=0.48(Approx)

ROI=Net operating income/Average operating assets

=(5,700,000/35,500,000)=16.06%(Approx)

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