Question

Figure 12-5. The following information pertains to the three divisions of Yang Company: Division A Division B Division C Sales ? ? $1,345,000 Net operating income $48,000 $18,000 $82,000 Average operating assets $420,000 ? ? Return on investment ? 15% 20% Margin 0.2 0.015 ? Turnover 2.1 ? ? Target ROI 17% 14% 8%

11. Refer to Figure 12-5. What are the average operating assets for Division C? a. $95,000 b. $410,000 c. $82,000 d. $420,000.

12. Refer to Figure 12-5. What is the turnover for Division C? a. 3.28 b. 0.20 c. 6.670 d. 1.500

13. Refer to Figure 12-5. What are the sales for Division B? a. $18,000 b. $1,250,000 c. $1,200,000 d. $208,333 14. Refer to Figure 12-5. What are the average operating assets for Division B?

Answer 1

Answer:

11). Option B) is correct. i.e$410,000

Average operating assets for Division C = Net operating Income / Return on investment
= $82,000 / 0.20
= $410,000

12). Option A) is correct. i.e$3.28

Turnover of Division C = Sales / Average operating assets
= $1,345,000 / $410,000
= 3.28
13). Option C) is correct. i.e $12,00,000

Sales for Division B = Net operating Income / Margin
= $18,000 / 0.015
= $1,200,000
.

14)

Division B:-

Average operating assets = Net operating income ÷ Return on investment = 18,000÷15% = $120,000

Answer is $120,000