Eiffel Inc. has two divisions it treats as investment centers. The results for last year were as follows:

Required: Compute the following amounts for each division:
1) Return on investment, desired rate of return is 11%
2) Residual income, desired rate of return is 18%
3) Capital turnover, desired rate of return is 25%
4) Sales margin, desired rate of return is 10%

Question

Eiffel Inc. has two divisions it treats as investment centers. The results for last year were as follows:
 
Required: Compute the following amounts for each division:
1) Return on investment, desired rate of return is 11%
2) Residual income, desired rate of return is 18%
3) Capital turnover, desired rate of return is 25%
4) Sales margin, desired rate of return is 10%

Quizplus · Accepted Answer

The Answer of Eiffel Inc. has two divisions it treats as investment centers. The results for last year were as follows:
 
Required: Compute the following amounts for each division:
1) Return on investment, desired rate of return is 11%
2) Residual income, desired rate of return is 18%
3) Capital turnover, desired rate of return is 25%
4) Sales margin, desired rate of return is 10%