Reference no: EM132990035

Question - For fiscal year 2020, Royal Division of Emerson LTD had income as follows:

Sales revenue $43,000,000

Expenses:

Cost of goods sold $28,400,000

Selling and administrative expense 5,600,000

Interest expense 1,100,000 35,100,000

Income before taxes 7,900,000

Income tax expense 2,765,000

Net income $ 5,135,000

The Royal Division's total assets were $89,000,000 and its current liabilities totaled $3,200,000 with $700,000 of these being interest-bearing. The company has a required rate of return of 9 percent and a cost of capital of 7.2 percent.

Required - Calculate NOPAT, invested capital, and return on investment for Regency Division and comment on the company's performance.