Use this information for ABC Corporation to answer the questions that follow.

ABC Corporation has three service departments with the following costs and activity base:

ABC has three operating divisions, Micro, Macro and Super. Their revenue, cost and activity information is as follows:

-Marshall Corporation had $220,000 in invested assets, sales of $242,000, income from operations of $66,000, and a desired minimum return of 3%. The return on investment for Marshall is
A) 9.1%
B) 30%
C) 3.0%
D) 27.3%

Question

Use this information for ABC Corporation to answer the questions that follow.
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ABC Corporation has three service departments with the following costs and activity base:
​
  ABC has three operating divisions, Micro, Macro and Super. Their revenue, cost and activity information is as follows:
​
 
-Marshall Corporation had $220,000 in invested assets, sales of $242,000, income from operations of $66,000, and a desired minimum return of 3%. The return on investment for Marshall is
A) 9.1% 
B) 30% 
C) 3.0% 
D) 27.3%

Quizplus · Accepted Answer

The return on investment (ROI) is calculated as the income from operations divided by the invested assets. For Marshall Corporation, ROI = $66,000 / $220,000 = 0.3 or 30%.

Use This Information for ABC Corporation to Answer the Questions