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ACC 202 PART II

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1.;value;20.00 points;Tundra Services Company, a division of a major oil company, provides various services to the operators of the North Slope oil field in Alaska. Data concerning the most recent year appear below;Sales $ 18,100,000;Net operating income $ 6,400,000;Average operating assets $ 36,400,000;Required;1 Compute the margin for Tundra Services Company. (Round your answer to 2 decimal places. Omit the "%" sign in your response.);Margin %;2 Compute the turnover for Tundra Services Company. (Round your answer to 2 decimal place.);Turnover;3 Compute the return on investment (ROI) for Tundra Services Company. (Round your intermediate calculations and final answer to 2 decimal places. Omit the "%" sign in your response.);ROI %;5.;value;10.00 points;2 The entrepreneur who founded the company is convinced that sales will increase next year by 130% and that net operating income will increase by 360%, with no increase in average operating assets. What would be the company?s ROI? (Do not round intermediate calculations. Round your answer to 2 decimal places. Omit the "%" sign in your response.);ROI %;6.;value;10.00 points;A family friend has asked your help in analyzing the operations of three anonymous companies operating in the same service sector industry. Supply the missing data in the table below: (Loss amounts should be indicated by a minus sign. Round your answers to the nearest whole number. Omit the "$" and "%" signs in your response.);Company;A B C;Sales $300,000 $740,000 $520,000;Net operating income $ $44,000 $;Average operating assets $168,000 $ $152,000;Return on investment (ROI) 19% 15% %;Minimum required rate of return;Percentage 14% % 15%;Dollar amount $ $45,000 $;Residual income $ $ $6,000;7.;value;10.00 points;Selected sales and operating data for three divisions of three different companies are given below;Division A Division B Division C;Sales $ 5,400,000 $ 9,400,000 $ 8,500,000;Average operating assets $ 1,080,000 $ 4,700,000 $ 1,700,000;Net operating income $ 243,000 $ 799,000 $ 148,750;Minimum required rate of return 14 % 17 % 11 %;Required;1 Compute the return on investment (ROI) for each division, using the formula stated in terms of margin and turnover. (Do not round intermediate calculations. Round your answers to 2 decimal places. Omit the "%" sign in your response.);ROI;Division A %;Division B %;Division C %;2 Compute the residual income for each division. (Negative amounts should be indicated by a minus sign. Leave no cells blank - be certain to enter "0" wherever required. Omit the "$" sign in your response.);Division A Division B Division C;Residual income $ $ $;3 Assume that each division is presented with an investment opportunity that would yield a rate of return of 16%.;a. If performance is being measured by ROI, which division or divisions will probably accept or reject the opportunity?;Division A (Click to select)RejectAccept;Division B (Click to select)AcceptReject;Division C (Click to select)RejectAccept;b. If performance is being measured by residual income, which division or divisions will probably accept or reject the opportunity?;Division A (Click to select)AcceptReject;Division B (Click to select)RejectAccept;Division C (Click to select)RejectAccept

 

Paper#80777 | Written in 18-Jul-2015

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