Reference no: EM132005079
Question - Calculating Return on Investment, Residual Income, Determining Effect of Changes in Sales, Expenses, Invested Asset, Hurdle Rate on Each
Coolbrook Company has the following information available for the past year:
River Division Stream Division
Sales revenue $ 1,200,000 $ 1,800,000
Cost of goods sold and operating expenses 900,000 1,300,000
Net operating income $ 300,000 $ 500,000
Average invested assets $ 1,200,000 $ 1,800,000
The company's hurdle rate is 6 percent.
Required:
1. Calculate return on investment (ROI) and residual income for each division for last year.
2. Recalculate ROI and residual income for each division for each independent situation that follows:
a. Operating income increases by 10 percent.
b. Operating income decreases by 10 percent.
c. The company invests $250,000 in each division, an amount that generates $100,000 additional income per division.
d. Coolbrook changes its hurdle rate to 10 percent.
|
Compute the residual income for each division
: Wescott is considering an expansion project in the upcoming year that will cost $5 million and return $450,000 per year. Compute the residual income
|
|
Show presentation that requires a strong grasp of timing
: This is a bit of a different discussion post and it doesn't require you to respond to peers. One major component of the research project.
|
|
Most from establishing trade rights in india
: What European power by the 18th century benefited most from establishing trade rights in India, and would later conquer and rule it?
|
|
How has being a part of the community changed you
: How has being a part of this community changed you? What 'role' does the community play in your every day life? What have you lessons have you learned.
|
|
Calculate return on investment and residual income
: Calculating Return on Investment, Residual Income, Determining Effect of Changes in Sales, Expenses, Invested Asset, Hurdle Rate on Each
|
|
How your older brother played an important role in your life
: You have to give me 4 essays of 500 words each. You should follow the pattern taught in the book. That is an essay of 5 paragraphs.
|
|
Calculate the direct materials price
: Bullseye Company manufactures dartboards. Calculate the direct materials price, quantity, and total spending variances for Bullseye
|
|
What religion did vasco da gama
: What religion did Vasco da Gama believe the King of Calicut and people to be?
|
|
Develop a coherently structured draft
: Develop a coherently structured draft that follows the structured detailed above. Use one (1) or more rhetorical strategies (ethos, logos, pathos).
|