1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
777dan777 [17]
3 years ago
9

The Atlantic Division of Start Production Company reported the following results for 2020: Sales $5,500,000 Variable Costs $2,20

0,000 Controllable Fixed Costs $2,540,000 Average Operating Assets $4,000,000 The minimum required rate of return of Start Production Company is 16%.
A. What is the controllable margin of the Atlantic Division for 2020?
B. What is the Return on Investment (ROI) for the Atlantic Division for 2020?
C. What is the Residual Income for the Atlantic Division for 2020?
Business
1 answer:
Yanka [14]3 years ago
7 0

Answer:

a. Controllable margin = Sales - Variable costs - Controllable fixed cost

=5,500,000 - 2,200,000 - 2,540,000

= $760000  

b. Return on Investment (ROI) =   Controllable margin / Average Operating Assets * 100

=  760,000 / 4,000,000 * 100

=0.19 * 100

=19%

c. Residual income = Controllable margin - Minimum required return  (4000000 * 16% = 640000)

=760,000 - 640,000

=$120,000

You might be interested in
A new company to produce state-of-the-art car stereo systems is being considered by Jagger Enterprises. The sales price would be
dybincka [34]

<u>Solution:</u>

The price per variable unit is set at 1.5 times the cost; the VC / unit is estimated at $2.50.

Price = 2.5 * 2.50 = $6.25

Variable cost = $2.50

Fixed cost = $220,000

Break-Even Volume = Fixed cost / (Price - Variable cost)

                                  = $220.000 / (6.25 - 2.50)

Break-Even Volume = 58,667 units

4 0
3 years ago
Lake Corporation reported the following amounts in its income statement: Sales revenue $ 440,000 Advertising expense 60,000 Inte
goldenfox [79]

Answer:

Lake's operating income is $120000

Explanation:

Operating income is the income generated by the operations of company less its operating cost. Another name that is used for operating income is Earnings before interest and tax (EBIT). The charges or income relating to non operating or financing activities is not included in the operating income and nor is the tax deduction included.

The formula for operating income = Sales - Cost of Sales - operating expenses.

The operating expenses here, are = Advertising + Salaries + Utilities

Thus, operating expenses = 60000 + 55000 + 25000 = $140000

The Operating Income = 440000 - 180000 - 140000 = $120000

3 0
3 years ago
Read 2 more answers
To edit a sentence for errors in​ spelling, a writer should
Naddika [18.5K]

Answer:

B

Explanation:

A is valid but i would be more worried about B when editing C and D say to fix something but it never says anything is wrong so the wording makes those answers wrong/very highly unlikely

3 0
3 years ago
Read 2 more answers
Which of the following housing decisions provides a person with both
Lana71 [14]
C selling a share in cooperative
3 0
3 years ago
Read 2 more answers
Assume that Juanita is indifferent between investing in a corporate bond that pays 12.00 percent interest and a stock with no gr
Dennis_Churaev [7]

Answer:

Juanita's marginal tax rate is 42.5%

Explanation:

marginal tax rate = MTR

After tax yield of dividend paying stock is 8.1% * (1-0.15) = 0.069 = 6.9%

The after tax yield of the bond will be 6.9%

Therefore,

6.9% = 12.0% * (1 - MTR)

6.9% = 12.0% - 12.0% *MTR

6.9% - 12.0% = -12.0% * MTR

-0.051 = -0.12*MTR

MTR = 0.051/0.12 = 0.425

MTR = 42.5%

3 0
3 years ago
Other questions:
  • Urgency, specific application, and size of order are examples of ________ segmentation variables for business markets.a. Situati
    12·1 answer
  • 4. If a good is considered "normal" by economists, an increase in consumers' incomes will result in a decrease in the
    6·1 answer
  • Which senior managers may assume a greater deal of transferability between domestic and international HRM practices?
    13·1 answer
  • Discuss Cultural heterogeneity of South africa
    7·2 answers
  • ESPAÑOL: 1) Una empresa posee activos por $8’000.000 y pasivos por $5’000.000; hallar el patrimonio. 2) Una empresa tiene activo
    14·1 answer
  • Business are hiring workers and GDP starts to increase as consumer spending increases
    7·1 answer
  • Consider a risky portfolio. The end-of-year cash flow derived from the portfolio will be either $120,000 or $300,000 with equal
    11·1 answer
  • Better Publications sold annual subscriptions to their magazine for $42,000 in December, 2016. The magazine is published monthly
    6·1 answer
  • Marginal revenue product is the
    13·2 answers
  • A machine with a book value of $80,000 has an estimated five-year life. A proposal is offered to sell the old machine for $50,50
    11·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!