If the company pursues the investment opportunity and

Assignment Help Accounting Basics
Reference no: EM13573097

Westerville Company reported the following results from last year's operations:


  Sales $ 1,300,000    
  Variable expenses
440,000    



  Contribution margin
860,000    
  Fixed expenses
600,000    



  Net operating income $ 260,000    



  Average operating assets $ 812,500    




This year the company has a $162,500 investment opportunity with the following cost and revenue characteristics:


  Sales $ 260,000
  Contribution margin ratio
80 % of sales
  Fixed expenses $ 182,000


The company's minimum required rate of return is 15%.

Required:

If the company pursues the investment opportunity and otherwise performs the same as last year, what ROI will it earn this year?

Reference no: EM13573097

Questions Cloud

As treasurer of the universal bed corporation aristotle : as treasurer of the universal bed corporation aristotle procrustes is worried about his bad debt ratio which is
Explain why proponents of lifo argue that it provides a : explain why proponents of lifo argue that it provides a better match of revenue and expenses. in what situation would
A three-month treasury bill and a six-month bill both sell : 1. a three-month treasury bill and a six-month bill both sell at a discount of 10. which offers the higher annual
By creating awareness of oppression and arousing sympathy : by creating awareness of oppression and arousing sympathy of supporters the arts can be a form of protest. identify and
If the company pursues the investment opportunity and : westerville company reported the following results from last years
Equal payments will be made over a 3 year period the first : you have borrowed 25000.00 at an interest rate of 16. equal payments will be made over a 3 year period. the first
The standard factory overhead rate is 750 per machine hour : the standard factory overhead rate is 7.50 per machine hour 6.20 for variable factory overhad and 1.30 for fixed
Mozart was considered a child prodigy performing throughout : mozart was considered a child prodigy performing throughout europe. cite your view on the notion of the child star and
There are no universally accepted definitions of financial : there are no universally accepted definitions of financial ratios but five of the following ratios are clearly

Reviews

Write a Review

Accounting Basics Questions & Answers

  Kaizen costing is a method that many japanese companies

kaizen costing is a method that many japanese companies have found effective in reducing costs. from a behavioral point

  The substantive ways in which using a residence as rental

the substantive ways in which using a residence as rental property could impact the gain or loss determination for the

  Briefly summarize the accounting techniques

Briefly summarize the accounting techniques used by cendant to manipulate financial results. Catagorize each techniques into one of Schilit's Financial shenanigans

  Prepare journal entries for factoring accounts receivable

Prepare all journal entries to record the preceding information. How the accounts related to BBB's factoring and assignment agreements be reported on BBB's year end financial statements

  How much will bkfcoms monthly profits change if they decide

in this make or buy problem you should compute the total cost of making a particular part and the total costs of buying

  Flint fabricators inc machines metal parts for the

flint fabricators inc. machines metal parts for the automotive industry. under the traditional manufacturing approach

  Calculate total book value of shares

How do you calculate total book value of shares before the dividend if the shareholder has 850 shares and book value per share is $38.18 ?

  Expected average rate of inflation problem

Suppose the rate of return on a 10-year T-bond is 6.85%, the expected average rate of inflation over the next 10 years is 2.0%, the MRP on a 10-year T-bond is 0.9%, no MRP is required on a TIPS, and no liquidity premium is required on any Treasury..

  From the following information develop an aon project

from the following information develop an aon project network. complete the forward and backward pass compute activity

  Investment in total income

Mouns Company owns 30% interest in the stock of Darian Corporation. During the year, Darian pays $20,000 in dividends to Mouns, and reports $100,000 in net income. Mouns Company's investment in Darian will increase Mouns' net income by?

  Economic interest of the entire organization

An internal transfer between two divisions is in the best economic interest of the entire organization when:

  What are the tax consequences to justin

What are the tax consequences to Justin for these expenditures when the restaurant opens in July? For Rachel?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd