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E10-4 Finding Unknowns Using Return on Investment, Profit Margin, Investment Turnover [LO 10-4] Krall Company recently...
E10-4 Finding Unknowns Using Return on Investment, Profit Margin, Investment Turnover [LO 10-4]
Krall Company recently had a computer malfunction and lost a
portion of its accounting records. The company has reconstructed
some of its financial performance measurements including components
of the return on investment calculations.
Required:
Help Krall rebuild its information database by completing the
following table: (Do not round your intermediate
calculations. Round your final answers to 2 decimal places, (i.e.
0.1234 should be entered as 12.34%.))
|
Solutions
Expert Solution
Solution:
| Return on Investment | Profit Margin | Investment Turnover | Operating Income | Sales Revenue | Average Invested Assets |
| 2.81% | 6.01% | 0.47 | $43,000.00 | $7,16,000.00 | $15,30,000.00 |
| 4.53% | 10.30% | 0.44 | $1,16,019.20 | $11,26,400.00 | $25,60,000.00 |
| 30.02% | 15.80% | 1.90 | $5,25,350.00 | $33,25,000.00 | $17,50,000.00 |
| 12.10% | 5.04% | 2.40 | $25,208.33 | $5,00,000.00 | $2,08,333.33 |
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Mastery
Problem: Return on Investment, margin, and turnover
Return on
Investment (ROI)
The manager of an
investment center should be evaluated based on revenues, costs, and
investments. An evaluation based on net income ignores the amount
of investment the investment center required. One way to measure
operating profit in relation to investment is a calculation called
the return on investment.
One formula for calculating return on investment is:
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Mastery Problem: Return on Investment, margin, and turnover Return on Investment (ROI) The manager of an...
Mastery
Problem: Return on Investment, margin, and turnover
Return on
Investment (ROI)
The manager of an
investment center should be evaluated based on revenues, costs, and
investments. An evaluation based on net income ignores the amount
of investment the investment center required. One way to measure
operating profit in relation to investment is a calculation called
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Orange
Company
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For the Years Ended December
31
2013
2012
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$
600,000
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520,000
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Cost of Goods Sold
$
415,000
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354,000
Selling and
administrative
$
120,800
$
114,600
Interest Expense
$
7,800
$
6,000
Income Tax...
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Required:
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