The top management at Groundsource Company, a manufacturer of lawn and garden equipment, is attempting to recover from a fire that destroyed some of their accounting records. The main computer system was also severely damaged. The following information was salvaged:

What is the Tractor Division's investment turnover?
A) 5.0
B) 8.3
C) 1.7
D) 1.0

Question

The top management at Groundsource Company, a manufacturer of lawn and garden equipment, is attempting to recover from a fire that destroyed some of their accounting records. The main computer system was also severely damaged. The following information was salvaged:

What is the Tractor Division's investment turnover?

What is the Tractor Division's investment turnover?
A) 5.0 
B) 8.3 
C) 1.7 
D) 1.0

Quizplus · Accepted Answer

Investment Turnover = Sales / Assets
Step 1 is to calculate the Assets
ROI = Net Income / Assets
Assets = Net Income / ROI
Assets = $1,200,000 / 0.2 = $6,000,000
Then Investment Turnover = $10,000,000 / $6,000,000 = 1.7

The Top Management at Groundsource Company, a Manufacturer of Lawn