thanks to who can help Benet Division of Bonita Company's...
90.2K
Verified Solution
Link Copied!
Question
Accounting
thanks to who can help
Benet Division of Bonita Company's operating results include: controllable margin, $196000; sales $2200000; and operating assets, $700000, The Benet Division's ROI is 28%. Management is considering a project with sales of $100000, variable expenses of $60000, fixed costs of $40000; and an asset investment of $150000. Should management accept this new project? No, because ROl will decrease. Yes, because ROI will increase. Yes, because additional sales always mean more customers. No, because a loss will be incurred. Sheffield Division's operating results includec controllable margin of $264000, sales totaling $1700000, and average operating assets of $800000. Sheffield is considering a project with sales of $100000, expenses of $84000, and an investment of average operating assets of $200000. Sheffield's required rate of return is 10%. Should Sheffield accept this project? Yes, ROl will drop by 6.6% which is still above the minimum required rate of return. No, the return is less than the required rate of 10% Yes, ROl still exceeds the cost of capital. No, ROl will decrease to 8%
Answer & Explanation
Solved by verified expert
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Zin AI - Your personal assistant for all your inquiries!
