Question
In: Accounting
Rate of Return on Investment Commodore Entertainment recently reported sector income from operations, revenue, and invested...
Rate of Return on Investment
Commodore Entertainment recently reported sector income from operations, revenue, and invested assets as follows:
Media Networks: The ABC television and radio network, Commodore channel, ESPN, A&E, E!, and Commodore.com
Parks and Resorts: Commodore World Resort, Commodoreland, Commodore Cruise Line, and other resort properties
Studio Entertainment: Commodore Entertainment, which releases films by Pixar Animation Studios, Marvel Studios, Commodore/Lucasfilm, and Touchstone Pictures
Consumer Products: Character merchandising, Commodore stores, books, and magazines Commodore recently reported sector income from operations, revenue, and invested assets (in millions) as follows
| Income from Operations |
Revenue |
Invested Assets |
||||
| Media Networks | $133,920 | $753,300 | $837,000 | |||
| Parks and Resorts | 64,980 | 456,000 | 570,000 | |||
| Studio Entertainment | 10,258 | 312,200 | 446,000 | |||
| Consumer Products | 91,908 | 399,600 | 222,000 | |||
Use the DuPont formula to determine the rate of return on investment for the four Commodore Entertainment sectors. Round Profit Margin, ROI to one decimal place and Investment Turnover to two decimal places.
| Profit Margin | Investment Turnover | ROI | |
| Media Networks | % | % | |
| Parks and Resorts | % | % | |
| Studio Entertainment | % | % | |
| Consumer Products | % | % |
b. How do the four sectors differ in their profit margin, investment turnover, and return on investment?
has the highest profit margin, while has the lowest profit margin. has the highest return on investment, while has the lowest return on investment.
Solutions
Expert Solution
| Income from operations(a) | Invested | ||||||||
| Revenue(b) | Assets(c) | ||||||||
| Media Networks | 133,920.00 | 753,300.00 | 837,000.00 | ||||||
| Parks and Resorts | 64,980.00 | 456,000.00 | 570,000.00 | ||||||
| Studio Entertainment | 10,258.00 | 312,200.00 | 446,000.00 | ||||||
| Consumer Products | 91,908.00 | 399,600.00 | 222,000.00 | ||||||
| Profit margin=income from operations/Revenue*100 | |||||||||
| Investment turnover=Revenue/Invested Assets | |||||||||
| ROI=Income from operations/invested assets*100 | |||||||||
| Profit Margin(a/b*100) | Investment turnover(b/c) | ROI(a/c*100) | |||||||
| Media Networks | 17.78 | 0.90 | 16.00 | ||||||
| Parks and Resorts | 14.25 | 0.80 | 11.40 | ||||||
| Studio Entertainment | 3.29 | 0.70 | 2.30 | ||||||
| Consumer Products | 23.00 | 1.80 | 41.40 | ||||||
| Consumer products has the highest profit margin while studio entertainment has the lowest profit margin | |||||||||
| Consumer Products has the highest return on investment, while studio entertainment has the lowest return on investment. | |||||||||
ekkarill92 answered 1 year agoRelated Solutions
Rate of Return on Investment Commodore Entertainment recently reported sector income from operations, revenue, and invested...
Rate of Return on
Investment
Commodore
Entertainment recently reported sector income from operations,
revenue, and invested assets as follows:
Media Networks: The ABC television and radio
network, Commodore channel, ESPN, A&E, E!, and
Commodore.com
Parks and Resorts: Commodore World Resort,
Commodoreland, Commodore Cruise Line, and other resort
properties
Studio Entertainment: Commodore Entertainment,
which releases films by Pixar Animation Studios, Marvel Studios,
Commodore/Lucasfilm, and Touchstone Pictures
Consumer Products: Character merchandising,
Commodore stores, books, and magazines
Commodore recently
reported sector income from...
A Corporation reported the following activity in 2010: Income from operations: &
A Corporation reported the following activity in
2010:
Income from
operations:
$2,000,000
Deductions from operations before
Special
items:
(1,300,000)
Dividends from 15% owned
corporations
100,000
Total business meals
(40,000)
Total charitable contribution
(130,000)
NOL carryover from previous
year
(35,000)
Assignment - Calculate the following in good
form:
Corporate taxable income
Corporate tax liability
Charitable contribution carryover (if
any)
Dividend revenue and interest revenue are reported in the income statement as a component of a...
Dividend revenue and interest revenue are reported in the income
statement as a component of a company's net income
True or False
2.Amortizing a discount on along−termbond investment willcause: A.the interest revenue reported on the income statement to...
2.Amortizing a discount on along−termbond investment
willcause:
A.the interest revenue reported on the income statement to equal
the cash received by the investor
B.the cash received by the investor to exceed the interest
revenue reported on the income statement
C.the interest revenue reported on the income statement to
exceed the cash received by the investor
D.the interest revenue reported is not related to the cash
received by the investor
3.When a premium on a bond investment is amortized by the...
Income from operations is one of the most important items reported by a company. Depending on...
Income from operations is one of the most important items
reported by a company. Depending on the decision-making needs of
management, income from operations can be determined using
absorption costing or variable costing.
Choose whether the following characteristics are most often
associated with absorption costing or variable costing.
Absorption Costing
Variable Costing
Required under generally accepted accounting principles
(GAAP)
Often used for internal use in decision making
Cost of goods manufactured includes only variable manufacturing
costs
Used in reports prepared...
E10-5 Calculating Return on Investment, Residual Income, Determining Effect of Changes in Sales, Expenses, Invested Assets,...
E10-5 Calculating Return on Investment, Residual Income,
Determining Effect of Changes in Sales, Expenses, Invested Assets,
Hurdle Rate on Each [LO 10-4, 10-5]
Solano Company has sales of $780,000, cost of goods sold of
$510,000, other operating expenses of $38,000, average invested
assets of $2,300,000, and a hurdle rate of 12 percent.
Required:
1. Determine Solano’s return on investment (ROI),
investment turnover, profit margin, and residual income.
(Do not round your intermediate calculations. Enter your
ROI and Profit Margin percentage...
Find rate of return on your investment if P = $1000 and annual income = $71...
Find rate of return on your investment if P = $1000 and annual
income = $71 for 25 years of your business.
Describe how the following types of revenue are reported on the Income Statement: a...Discounts from Charges...
Describe how
the following types of revenue are reported on the Income
Statement:
a...Discounts
from Charges
b...Charity
care
c...Bad Debt
Losses
What do you
think is the significance behind this reporting
method?
Randolph Company reported pretax net income from continuing operations of $1,003,000 and taxable income of $710,000....
Randolph Company reported pretax net income from continuing
operations of $1,003,000 and taxable income of $710,000. The
book-tax difference of $293,000 was due to a $283,000 favorable
temporary difference relating to depreciation, an unfavorable
temporary difference of $140,000 due to an increase in the reserve
for bad debts, and a $150,000 favorable permanent difference from
the receipt of life insurance proceeds. Randolph Company’s
applicable tax rate is 34 percent.
a. Compute Randolph Company’s current income
tax expense.
b. Compute Randolph...
Randolph Company reported pretax net income from continuing operations of $959,000 and taxable income of $590,000....
Randolph Company reported pretax net income from continuing
operations of $959,000 and taxable income of $590,000. The book-tax
difference of $369,000 was due to a $205,000 favorable temporary
difference relating to depreciation, an unfavorable temporary
difference of $88,000 due to an increase in the reserve for bad
debts, and a $252,000 favorable permanent difference from the
receipt of life insurance proceeds.
c. Compute Randolph Company’s effective tax
rate. (Round your answer to 2 decimal places.)
Effective
tax rate
%
d....
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- write an implementation of the ADT stack that uses a resizeable array to represent the stack...
- Problem) Fraud Scheme - Purchasing Agent: A purchasing agent for a large hardware retailer has sole...
- Ivanhoe Corporation has collected the following information after its first year of sales. Sales were $1,600,000...
- There are two major approaches to corporate valuation: a) using comparable firms (via multiples, i.e. ratios)...
- A 4-year annuity of eight $9,800 semiannual payments will begin 7 years from now, with the...
- Consider the following relation schema about project meetings: PMG(projID, title, type, manager, jobID, start-date, end-date, contractor,...
- Question 3 a) A coil consist of 2000 turns of copper wire having a cross sectional...
ADVERTISEMENT