The management of E.F. Lynch Company is evaluating each division as a basis for planning...
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The management of E.F. Lynch Company is evaluating each division as a basis for planning a future expansion of operations. Required: 1. Prepare condensed divisional income statements for the three divisions, assuming that there were no support department allocations. F F I uneh Comnanu Feedback 2. Using the DuPont formula for return on investment, compute the profit margin, investment turnover, and return on investment for each division. Round your answers to one t. Fredbsck Check My Wrek 2. Operating income divided by sales equals profit margin. Sales divided by invested assets equals investment turnover. Multiply these two values for the rate of return. 3. Consider which division is the most profitable. Look at investment turnover and the impact of expansion on the company
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