The Walter Foundation invested $3,500,000 in a plant to remanufacture refrigerators.The target operating income from the plant is $250,000 annually.The company plans actual sales of 800 refrigerators at $1,100.00 each.
Required:
Compute the target rate of return on the investment at the Walter Foundation.

Question

Quizplus · Accepted Answer

B)[($250,000 / $3,500,000)] = 7.14%

The Walter Foundation Invested $3,500,000 in a Plant to Remanufacture