Please Answer for the blank boxes - the answers already in are correct. \"I know
ID: 2500412 • Letter: P
Question
Please Answer for the blank boxes - the answers already in are correct.
"I know headquarters wants us to add that new product line," said Fred Halloway, manager of Klrsi Products 'East Division. 'But I want to see the numbers before I make a move. Our division s return on investment (ROI) has led the company for three years, and I don't want any letdown." Kirsi Products is a decentralized wholesaler with four autonomous divisions. The divisions are evaluated on the basis of ROI, with year-end bonuses given to divisional managers who have the highest ROI. Operating results for the company's East Division for last year are given below: The company has an overall ROI of 17.50% last year (considering all division). The company's East Division has an opportunity to add a new product line that would require an investment of $2, 250, 500. The cost and revenue characteristics of the new product line per year would be as follows: Compute the East Division's ROI for last year; also compute the ROI as it would appear if the new product line is added. (Round your intermediate calculations and the "Turnover", "ROI" answers and "Margin" answers to 2 decimal places.)Explanation / Answer
Particulars Present New Line Total Sales 21902000 9450000 31352000 Net Operating Income 2058400 737300 2795700 Operating Assets 4562500 2250500 6813000 Margin: (Net Operating Income/Sales) 9.40% 7.80% 8.92% Turnover : (Sales/Net Operating Assets) 4.8 4.12 4.6 ROI: Margin*Turnover) 45.12% 32.14% 41.03%