Orange Corp. has two divisions: Fruit and Flower. The following information for the past year is available for each division:
| Fruit Division | Flower Division | ||||
| Sales revenue | $780,000 | $1,170,000 | |||
|
585,000 | 877,500 | |||
| Net operating income | $195,000 | $292,500 | |||
|
$1,950,000 | $1,625,000 |
Orange
has established a hurdle rate of 6
percent.
Required:
1-a.
Compute
each division’s return on investment (ROI) and residual income for
last year.
(Enter your ROI answers as a percentage rounded to two
decimal places, (i.e., 0.1234 should be entered as
12.34%.))
| Fruit Division | Flower Division | |
| ROI | % | % |
| Residual Income (Loss) | % | % |
1-b. Determine which manager seems to be performing better.(Choose one)
Flower Division
Fruit Division
2. Suppose Orange is investing in new technology that will increase each division’s operating income by $124,000. The total investment required is $1,700,000, which will be split evenly between the two divisions. Calculate the ROI and return on investment for each division after the investment is made. (Enter your ROI answers as a percentage rounded to two decimal places, (i.e., 0.1234 should be entered as 12.34%.))
| Fruits Division | Flower Division | |
| ROI | % | % |
| Residual Income (Loss) |
3. Which manager will accept the investment
| Fruits Division | Accept or Reject |
| Flower Division | Accept or Reject |
In: Accounting
TE10-7 Evaluating Managerial Performance Using Return on Investment, Residual Income [LO 10-4, 10-5]
Orange Corp. has two divisions: Fruit and Flower. The following
information for the past year is available for each division:
| Fruit Division | Flower Division | ||||
| Sales revenue | $ | 1,320,000 | $ | 1,980,000 | |
| Cost of goods sold and operating expenses | 990,000 | 1,485,000 | |||
| Net operating income | $ | 330,000 | $ | 495,000 | |
| Average invested assets | $ | 5,000,000 | $ | 1,980,000 | |
Orange has established a hurdle rate of 5
percent.
Required:
1-a. Compute each division’s return on investment
(ROI) and residual income for last year. (Enter your ROI
answers as a percentage rounded to two decimal places, (i.e.,
0.1234 should be entered as 12.34%.))
ROI:
Residual Income:
1-b. Determine which manager seems to be
performing better.
| Fruit Division | |
| Flower Division |
2. Suppose Orange is investing in new technology
that will increase each division’s operating income by $142,000.
The total investment required is $2,100,000, which will be split
evenly between the two divisions. Calculate the ROI and return on
investment for each division after the investment is made.
(Enter your ROI answers as a percentage rounded to two
decimal places, (i.e., 0.1234 should be entered as
12.34%.))
ROI :?
Residual Income (Loss) :?
3. Which manager will accept the investment.
Fruit or flower?
In: Accounting
The consolidated 2019, 2018, and 2017 income statements for Butler Corporation follow.
|
Butler Corporation |
|
Consolidated Income Statements |
|
(in millions except per share amounts) |
|
1 |
December 31 |
December 31 |
December 31 |
|
|
2 |
2019 |
2018 |
2017 |
|
|
3 |
Net sales |
$25,020.70 |
$21,970.00 |
$19,292.20 |
|
4 |
Costs and expenses: |
|||
|
5 |
Cost of goods sold |
(11,946.10) |
(10,611.70) |
(9,366.20) |
|
6 |
Selling, general, and administrative |
(9,864.40) |
(8,721.20) |
(7,605.90) |
|
7 |
Amortization of intangible assets |
(303.70) |
(265.90) |
(208.30) |
|
8 |
Operating income |
$2,906.50 |
$2,371.20 |
$2,111.80 |
|
9 |
Interest expense |
(572.70) |
(586.10) |
(613.70) |
|
10 |
Interest income |
88.70 |
113.70 |
161.60 |
|
11 |
Income before income taxes |
$2,422.50 |
$1,898.80 |
$1,659.70 |
|
12 |
Provision for income taxes |
834.60 |
597.10 |
597.50 |
|
13 |
Net income |
$1,587.90 |
$1,301.70 |
$1,062.20 |
Required:
| 1. | Prepare common size income statements for horizontal analysis (in percentage terms, rounded to one decimal place). You do not need to include the actual dollar amounts shown above. |
| 2. | Indicate what Butler’s 2019, 2018, and 2017 tax rates were on its income before taxes (in percentage terms, rounded to two decimal places). |
Labels and Amount Descriptions
| Labels | |
| Costs and expenses | |
| Amount Descriptions | |
| Net sales | |
| Net income | |
| Net loss |
In: Accounting
Comparing Income Statements and Balance Sheets of
Competitors
Following are selected income statement and balance sheet data from
two retailers: Abercrombie & Fitch (clothing retailer in the
high-end market) and TJX Companies (clothing retailer in the
value-priced market).
(a) Express each income statement amount as a percentage of sales.
Round your answers to one decimal place (example: 0.2345 = 23.5%).
| Income Statement | |||||
|---|---|---|---|---|---|
| ($ millions) | ANF | TJX | |||
| Sales | $3,469 | $21,942 | |||
| Cost of goods sold | 1,257 | Answer% | 16,040 | Answer% | |
| Gross profit | 2,212 | Answer% | 5,902 | Answer% | |
| Total expenses | 2,062 | Answer% | 4,559 | Answer% | |
| Net income | $ 150 | Answer% | $ 1,343 | Answer% | |
(b) Express each balance sheet amount as a percentage of total
assets.
Round your answers to one decimal place (ex: 0.2345 = 23.5%)
| Balance Sheet | |||||
|---|---|---|---|---|---|
| ($ millions) | ANF | TJX | |||
| Current assets | $1,433 | Answer% | $5,100 | Answer% | |
| Long-term assets | 1,515 | Answer% | 2,872 | Answer% | |
| Total assets | $2,948 | $7,972 | |||
| Current liabilities | $ 559 | Answer% | $3,133 | Answer% | |
| Long-term liabilities | 498 | Answer% | 1,739 | Answer% | |
| Total liabilities | 1,057 | Answer% | 4,872 | Answer% | |
| Stockholders' equity | 1,891 | Answer% | 3,100 | Answer% | |
| Total liabilities and equity | $2,948 | $7,972 | |||
answer all the parts that say answer please.
In: Accounting
A survey found that women's heights are normally distributed with mean 63.2 in and standard deviation
2.3 in The survey also found that men's heights are normally distributed with mean 69.1 in and standard deviation
3.3 in Consider an executive jet that seats six with a doorway height of 55.9 in. Complete parts (a) through (c) below.
A) what percentage of adult men can fit through the door without bending?
The percentage of men who can fit without bending is __%?
B) Does the door design with a height of 55.9 in. appear to be adequate? Why didn't the engineers design a larger door?
Options
A.
The door design is inadequate, but because the jet is relatively
small and seats only six people, a much higher door would require
major changes in the design and cost of the jet, making a larger
height not practical.
B.
The door design is adequate, because although many men will not be
able to fit without bending, most women will be able to fit
without bending. Thus, a larger door is not needed.
C.
The door design is inadequate, because every person needs to be
able to get into the aircraft without bending. There is no reason
why this should not be implemented.
D.
The door design is adequate, because the majority of people will
be able to fit without bending. Thus, a larger door is not
needed.
----------------------------------------------------------------------------
Finally C) The doorway height that would allow 40% of men to fit without bending ___ in.
(Round to one decimal place)
In: Statistics and Probability
Coolbrook Company has the following information available for the past year: River Division Stream Division Sales revenue $ 1,216,000 $ 1,804,000 Cost of goods sold and operating expenses 881,000 1,296,000 Net operating income $ 335,000 $ 508,000 Average invested assets $ 1,090,000 $ 1,520,000 The company’s hurdle rate is 6.76 percent.
Required: 1. Calculate return on investment (ROI) and residual income for each division for last year. (Enter your ROI answers as a percentage rounded to two decimal places, (i.e., 0.1234 should be entered as 12.34%.))
|
|||||||||||||||
2. Recalculate ROI and residual income for each
division for each independent situation that follows:
(Enter your ROI answers as a percentage rounded to two
decimal places, (i.e., 0.1234 should be entered as
12.34%.))
a. Operating income increases by 8 percent.
|
|||||||||||||||
b. Operating income decreases by 10 percent.
|
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|
c. The company invests $252,000 in each division, an amount that generates $106,000 additional income per division |
|
|
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d. Coolbrook changes its hurdle rate to 4.76 percent.
|
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In: Accounting
For the following program descriptions, write step by step
pseudo code that shows you understand the problem and what it takes
to solve it. The first one is done for you as an
example. Please answer the questions in the same format as the
example problem below so it is the same.
Example #1 Problem
A customer is purchasing five items. Design a program where you
collect the amount of each item,
calculate the subTotal of the items, the tax at 7%, and a grand
total. The output will display the subTotal,
tax and grand total formatted with 2 decimal places and a $.
Answer
Declare variables: item1, item2, item2, item4, item5, subtotal,
tax, grandTotal
Declare constant TAX_RATE=0.07
Get the price for each item
Calculate the subtotal=item1 + item2 + item3 + item4 + item5
Calculate the tax = subtotal * TAX_RATE
Calculate the grandTotal=subtotal + tax
Display the subtotal
Display the sales tax
Display the grandTotal
Question
3. Design a program that calculates the total amount of a meal
purchased at a restaurant. The program
should ask the user to enter the charge for the food, then
calculate the amount of an 18% tip and 7%
sales tax and the total cost of the meal including the tax and
tip.
4. Design a program that asks the user for the number of males and
females registered in a class. The
program should display the percentage of males and females in the
class. You will need to calculate the
total number of students first to get the percentage of males and
females.
In: Computer Science
Lavage Rapide is a Canadian company that owns and operates a large automatic car wash facility near Montreal. The following table provides data concerning the company’s costs:
| Fixed Cost per Month |
Cost per Car Washed |
||||||
| Cleaning supplies | $ | 0.50 | |||||
| Electricity | $ | 1,100 | $ | 0.06 | |||
| Maintenance | $ | 0.20 | |||||
| Wages and salaries | $ | 4,500 | $ | 0.20 | |||
| Depreciation | $ | 8,100 | |||||
| Rent | $ | 2,100 | |||||
| Administrative expenses | $ | 1,400 | $ | 0.05 | |||
For example, electricity costs are $1,100 per month plus $0.06 per car washed. The company expects to wash 8,500 cars in August and to collect an average of $6.10 per car washed.
The actual operating results for August appear below.
| Lavage Rapide | ||
| Income Statement | ||
| For the Month Ended August 31 | ||
| Actual cars washed | 8,600 | |
| Revenue | $ | 53,950 |
| Expenses: | ||
| Cleaning supplies | 4,750 | |
| Electricity | 1,580 | |
| Maintenance | 1,940 | |
| Wages and salaries | 6,560 | |
| Depreciation | 8,100 | |
| Rent | 2,300 | |
| Administrative expenses | 1,725 | |
| Total expense | 26,955 | |
| Net operating income | $ | 26,995 |
Required:
Prepare a flexible budget performance report that shows the company’s revenue and spending variances and activity variances for August. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.)
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In: Accounting
Lavage Rapide is a Canadian company that owns and operates a large automatic car wash facility near Montreal. The following table provides data concerning the company’s costs:
| Fixed Cost per Month |
Cost per Car Washed |
||||||
| Cleaning supplies | $ | 0.40 | |||||
| Electricity | $ | 1,200 | $ | 0.06 | |||
| Maintenance | $ | 0.10 | |||||
| Wages and salaries | $ | 4,800 | $ | 0.30 | |||
| Depreciation | $ | 8,300 | |||||
| Rent | $ | 2,100 | |||||
| Administrative expenses | $ | 1,500 | $ | 0.01 | |||
For example, electricity costs are $1,200 per month plus $0.06 per car washed. The company expects to wash 8,000 cars in August and to collect an average of $6.20 per car washed.
The actual operating results for August appear below.
| Lavage Rapide | ||
| Income Statement | ||
| For the Month Ended August 31 | ||
| Actual cars washed | 8,100 | |
| Revenue | $ | 51,700 |
| Expenses: | ||
| Cleaning supplies | 3,700 | |
| Electricity | 1,650 | |
| Maintenance | 1,040 | |
| Wages and salaries | 7,560 | |
| Depreciation | 8,300 | |
| Rent | 2,300 | |
| Administrative expenses | 1,480 | |
| Total expense | 26,030 | |
| Net operating income | $ | 25,670 |
Required:
Prepare a flexible budget performance report that shows the company’s revenue and spending variances and activity variances for August. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.)
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In: Accounting
ch8 exer #3
|
Lavage Rapide is a Canadian company that owns and operates a large automatic carwash facility near Montreal. The following table provides data concerning the company’s costs: |
| Fixed Cost per Month |
Cost per Car Washed |
||||
| Cleaning supplies | $ | 0.70 | |||
| Electricity | $ | 1,500 | $ | 0.09 | |
| Maintenance | $ | 0.25 | |||
| Wages and salaries | $ | 4,000 | $ | 0.20 | |
| Depreciation | $ | 8,400 | |||
| Rent | $ | 2,000 | |||
| Administrative expenses | $ | 1,500 | $ | 0.03 | |
|
|
|||||
|
For example, electricity costs are $1,500 per month plus $0.09 per car washed. The company actually washed 8,000 cars in August. The company expected to collect an average of $6.70 per car washed. |
| The actual operating results for August appear below. |
| Lavage Rapide Income Statement For the Month Ended August 31 |
||
| Actual cars washed | 8,000 | |
| Revenue | $ | 53,560 |
|
|
|
|
| Expenses: | ||
| Cleaning supplies | 6,130 | |
| Electricity | 2,370 | |
| Maintenance | 2,600 | |
| Wages and salaries | 6,520 | |
| Depreciation | 8,400 | |
| Rent | 2,000 | |
| Administrative expenses | 1,820 | |
|
|
|
|
| Total expense | 29,840 | |
|
|
|
|
| Net operating income | $ | 23,720 |
|
|
|
|
|
|
||
| Required: | |||||||||||||||||||||||||||||||||||||||||||||
|
Prepare a report showing the company’s revenue and spending variances for August. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.)
|
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In: Accounting