Answer:
Queensland 14.7%
New South Wales is 24.0%
Explanation:
This is a case of modified return on investment since the question was specific that the return on investment should in terms margin and assets turnover.
The first task would be to compute margin and turnover whereas the return on investment would be the multiples of both performance measures.
Margin =operating income/sales
Asset turnover=sales/average operating assets
operating income/sales*sales/average operating assets=operating income/average assets
This question also require proofing the above formula as I have done.
Margin Assets turnover ROI
Queensland$82,320/$784,000=10.5%$784,000/$560,000=1.4 14.7%
South Wales$118,800/$1,485,000=8% $1,485,000/$495,000= 24.0%
R0I=margin*assets turnover
Queensland=10.5%*1.4=14.7%
New south sales=8%*3=24%
