Barrera Corporation provides the following financial information: $$\begin{array} { | l | r | }
\hline \text { Minimum acceptable operating income } & \$ 556,600 \
\hline \text { Average total assets } & \$ 2,600,000 \
\hline \text { Operating income } & \$ 708,000 \
\hline \text { Return on investment } & 27,23 \% \
\hline \text { Net sales } & \$ 900,000 \
\hline
\end{array}$$ Calculate the target rate of return.(Round your answer to two decimal places.)
A) 21.41%
B) 78.67%
C) 27.23%
D) 61.84%

Question

Barrera Corporation provides the following financial information: $$\begin{array} { | l | r | } 
\hline \text { Minimum acceptable operating income } & \$ 556,600 \
\hline \text { Average total assets } & \$ 2,600,000 \
\hline \text { Operating income } & \$ 708,000 \
\hline \text { Return on investment } & 27,23 \% \
\hline \text { Net sales } & \$ 900,000 \
\hline
\end{array}$$ Calculate the target rate of return.(Round your answer to two decimal places.)
A) 21.41%
B) 78.67%
C) 27.23%
D) 61.84%

Quizplus · Accepted Answer

The target rate of return can be calculated using the formula: Target Rate of Return = (Minimum acceptable operating income / Average total assets) * 100. Plugging in the numbers from the table: (556,600 / 2,600,000) * 100 = 21.41%.

Barrera Corporation Provides the Following Financial Information Calculate the Target Rate of Return