Question

Comparative data on three companies in the same service industry are given below.

Required:

2. Fill in the missing information. (Round the "Turnover" and "ROI" answers to 2 decimal places.)

Company A, B, C

Sales $3,950,000 $1,020,000, Need (C)

Net operating income $671,500 $183,600, Need(c)

Average operating assets $1,580,000, NEED(b), $2,880,000

Margin Need(A)% Need(b)% 4 %

Turnover Need(a), Need(b), 2.20

Return on investment (ROI) NEED(a)% 7.20 % Need(c)%

Answer 1

	A	B	C
Sales	3950000	1020000	6336000
Net operating income	671500	183600	253440
Average operating assets	1580000	2550000	2880000
Margin	17%	18%	4%
Turnover	2.50	0.40	2.20
Return on investment (ROI)	42.50%	7.20%	8.80%
Margin = Net operating income/Sales
Turnover = Sales/Average operating assets
Return on investment (ROI) = Margin * Turnover