1) Guerlane Fragrance Corporation has a perfume division, Essense, and a cologne division, Karisma. The following information relates to last year's operations at each division. The minimum required rate of return is the same for both divisions. Essense Karisma Sales $360,000 (d) Average operating assets $120,000 (e) Net operating income $10,000 Margin (b) Turnover (c) 2.5 Return on investment (ROI) 20% (f) Residual income $6,000 Required: Compute the unknown quantities above [(a) through (g)]. SHOW YOUR COMPUTATIONS.
1) Guerlane Fragrance Corporation has a perfume division, Essense, and a cologne division, Karisma. The following information relates to last year's operations at each division. The minimum required rate of return is the same for both divisions. Essense Karisma Sales $360,000 (d) Average operating assets $120,000 (e) Net operating income $10,000 Margin (b) Turnover (c) 2.5 Return on investment (ROI) 20% (f) Residual income $6,000 Required: Compute the unknown quantities above [(a) through (g)]. SHOW YOUR COMPUTATIONS.
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter10: Decentralization: Responsibility Accounting, Performance Evaluation, And Transfer Pricing
Section: Chapter Questions
Problem 1CE: Forchen, Inc., provided the following information for two of its divisions for last year: Required:...
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