Selected data from Division A of Green Company are as follows:
$\begin{array}{lcc}
\text { Sales } & \$ & 500,000 \
\text { Average investment } & \$ & 300,000 \
\text { Operating income } & \$ & 60,000 \
\text { Minimum rate of return } & & 15 \%
\end{array}$Division A's return on sales (ROS) is:
A)1.8%.
B)7.5%.
C)12.0%.
D)20.0%.
E)48.0%.

Question

Quizplus · Accepted Answer

Return on Sales (ROS) is calculated as Operating Income divided by Sales. For Division A, ROS = $60,000 / $500,000 = 0.12 or 12%.

Selected Data from Division a of Green Company Are as Follows