Evaluation of responsibility centers
Shown below are the current-year data for two investment centers of Chelsea Trading,Inc.The total assets utilized by each of these investment centers during the year amount to $1,500,000:
(a)Compute the following measures for each investment center: (b)Assume that a $3,000 monthly expenditure for advertising could increase the monthly sales of either investment center by $20,000.Which center should the company advertise to receive the maximum benefit from its advertising expenditure? Center ________.Explain your reasoning:

Question

Evaluation of responsibility centers
Shown below are the current-year data for two investment centers of Chelsea Trading,Inc.The total assets utilized by each of these investment centers during the year amount to $1,500,000:
  (a)Compute the following measures for each investment center:  (b)Assume that a $3,000 monthly expenditure for advertising could increase the monthly sales of either investment center by $20,000.Which center should the company advertise to receive the maximum benefit from its advertising expenditure? Center ________.Explain your reasoning:

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The Answer of Evaluation of responsibility centers
Shown below are the current-year data for two investment centers of Chelsea Trading,Inc.The total assets utilized by each of these investment centers during the year amount to $1,500,000:
  (a)Compute the following measures for each investment center:  (b)Assume that a $3,000 monthly expenditure for advertising could increase the monthly sales of either investment center by $20,000.Which center should the company advertise to receive the maximum benefit from its advertising expenditure? Center ________.Explain your reasoning:

Evaluation of Responsibility Centers