Question

Given the following information for Mako Company please answer the following questions: Sales $500,000 Turnover 3...

Given the following information for Mako Company please answer the following questions:

Sales $500,000
Turnover 3
Margin 0.15
Desired Rate of Return 20%

What is the Return on Investment?

Multiple Choice

  • 45%

  • 18%

  • 20%

  • 60%

0 0
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Answer #1

Margin=Net operating income/Sales

turnover=Sales/Average operating assets

ROI=Net operating income/Average operating assets

=Margin*Turnover

=(3*15)

=45%

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