Exercise 11-8 Computing and Interpreting Return on Investment (ROI) [LOI Selecte
ID: 2596644 • Letter: E
Question
Exercise 11-8 Computing and Interpreting Return on Investment (ROI) [LOI Selected operating data for two divisions of Outback Brewing, Ltd., of Australia are given below New South Wales Queensland Sales Average operating assets Net operating income Property, plant, and equipment (net) $ 4,000,000 7,000,000 $ 2,000,800 2,000,800 ,800 420,800 $ 950,800 $ 800,000 $360, Required: 1. Compute the rate of return for each division using the return on investment (ROl) formula stated in terms of margin and turnover 2. Which divisional manager seems to be doing the better job? Complete this question by entering your answers in the tabs below Required Required 2 Compute the rate of return for each division using the return on investment (ROI) formula stated in terms of margin and turnover. (Round Turnover answers to 1 decimal place.) Margin Turnover Queensland division New South Wales divisionExplanation / Answer
1).
2). The Divisional Manager of New South Wales is doing better job.
Particulars Queensland New South Wales Margin :- Net Operating Income $360000 $420000 Sales $4000000 $7000000 Margin (Net Operating income / Sales) 9% 6% Turnover :- Sales $4000000 $7000000 Avg. Operating Assets $2000000 $2000000 Turnover (Sales / Avg. Operating Assets) 200% 350% Return on Investment (Margin*Turnover) 18% 21%Related Questions
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