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Determining missing items in return on investment computation One item is omitted from each of the following computations of
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Answer #1

Using below formula solutions are given.

Return on investment = profit margin × investment turnover

Investment turnover = return on investment /Profit margin

Profit margin= return on investment /investment turnover

A. Investment turnover = 14% /10% = 1.4

B. Return on investment = 28% ×0 .75= 21%

C. Profit margin = 21% /1.5= 14%

D. Investment turnover = 10% /20%= 0.5

E. Return on investment = 15% × 1.6= 24%

Note: required data already available in question so only missing data are find out as per question asked so that directly used the formula for solution.

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