For the past year,Largo Company recorded sales of $750,000 and average operating assets of $375,000.What margin did Largo Company need to earn to achieve an ROI of 15%?
A) 2.00%
B) 7.50%
C) 9.99%
D) 15.00%

Question

Quizplus · Accepted Answer

To achieve an ROI (Return on Investment) of 15%, Largo Company needs to earn $56,250 (15% of $375,000 in operating assets). The margin is calculated as the earnings needed divided by sales. Thus, $56,250 / $750,000 = 7.5%.

For the Past Year,Largo Company Recorded Sales of $750,000 and Average