TB MC Qu. 9-57 (Algo) The New Products Division of Testar Company had... ...
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Accounting
TB MC Qu. 9-57 (Algo) The New Products Division of Testar Company had...
The New Products Division of Testar Company had operating income of $9,600,000 and operating assets of $46,400,000 during the current year. The New Products Division has developed a potential new product that would require $10,100,000 in operating assets and would be expected to provide $3,000,000 in operating income each year. Testar has set a target return on investment (ROI) of 21% for each of its divisions. Assuming that the new product is put into production, calculate the division's ROI. (Round your final answer to 2 decimal places.)
Multiple Choice
A. 20.69%
B. 22.30%
C. 29.70%
D. The answer cannot be determined using the information provided
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