In: Accounting
Company ABC has a TV division and a PC division. The following information relates to last year's operations at each division. The minimum required rate of return is the same for both divisions.
TV |
PC |
|
Sales |
$10,000 |
(d) |
Average operating assets |
$20,000 |
(e) |
Net operating income |
(a) |
$10,000 |
Residual Income |
$3,000 |
(f) |
Margin |
(b) |
5% |
Turnover |
(c) |
2 |
Return on Investment (ROI) |
20% |
(g) |
Company ABC tracks the time of processing orders. The average times were recorded as follows:
Queue Time |
3 hours |
Inspection Time |
2 hours |
Process Time |
(h) |
Move Time |
3 hours |
Wait Time |
5 hours |
Manufacturing Cycle Efficiency |
0.5 |
Delivery Cycle Time |
(i) |
Value-added Time |
(j) |
Compute the unknown quantities above [(a) through (j)]. SHOW YOUR COMPUTATIONS.