Division 3 of Baritune Enterprises reported sales of $820,000, NOPAT totaling $61,500, interest expense of $8,000, and invested capital totaling $512,500.Its income tax rate is 30%.As it pertains to evaluating investment centers, how much is Division 3's investment turnover?
A)1.60
B)7.50
C)12.00
D)0.625

Question

Quizplus · Accepted Answer

Investment turnover is calculated as sales divided by invested capital. For Division 3, this is $820,000 / $512,500 = 1.60.

Division 3 of Baritune Enterprises Reported Sales of $820,000, NOPAT