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11.1.11 Return on investment (ROI) is computed in the following manner ROI is equal to turnover multiplied by earnings as a percent of sales Turnover is sales divided by total investment Total investment is current assets (inventories, accounts receivable. and cash) plus fixed assets Earnings equal sales minus the cost of sales The cost of sales consists of variable production costs, selling expenses, freight and delivery, and administrative costs. Complete parts a and b a. Construct an influence diagram that relates these variables. Choose the correct diagram below Cirak huTO to view initence diagram B) Click here to view influence diagram C Click here to view influence diagram D. Click here to view influence diagram A. b. Develop a mathematical model using the symbols defined on the left E Earnings ROI = T Turnover T = VE S. Sales TI= C. Cost of Sales TI Total Investment CA. Current Assets FA Fixed Assets PC Prod Costs SC Sales Expense FC Freight and Delivery AC Admin Costs

11.1.11 Return on investment (ROI) is computed in the following manner ROI is equal to turnover multiplied by earnings as a percent of sales Turnover is sales divided by total investment Total investment is current assets (inventories, accounts receivable. and cash) plus fixed assets Earnings equal sales minus the cost of sales The cost of sales consists of variable production costs, selling expenses, freight and delivery, and administrative costs. Complete parts a and b a. Construct an influence diagram that relates these variables. Choose the correct diagram below Cirak huTO to view initence diagram B) Click here to view influence diagram C Click here to view influence diagram D. Click here to view influence diagram A. b. Develop a mathematical model using the symbols defined on the left E Earnings ROI = T Turnover T = VE S. Sales TI= C. Cost of Sales TI Total Investment CA. Current Assets FA Fixed Assets PC Prod Costs SC Sales Expense FC Freight and Delivery AC Admin Costs

Financial & Managerial Accounting
Financial & Managerial Accounting
14th Edition
ISBN:9781337119207
Author:Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:Carl Warren, James M. Reeve, Jonathan Duchac
Chapter20: Variable Costing For Management Analysis
Section: Chapter Questions
Problem 20.15EX: Segment profitability analysis The marketing segment sales for Caterpillar, Inc., for a year follow:...
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11.1.11 Return on investment (ROI) is computed in the following manner: ROI is equal to turnover multiplied by earnings as a percent of sales. Turnover is sales divided by total investment. Total investment is current assets (inventories, accounts receivable, and cash) plus fixed assets. Earnings equal sales minus the cost of sales. The cost of sales consists of variable production costs, selling expenses, freight and delivery, and administrative costs. Complete parts a and b. a. Construct an influence diagram that relates these variables. Choose the correct diagram below. Click here to view influence diagram B) Click here to view influence diagram C. Click here to view influence diagram D. Click here to view influence diagram A. b. Develop a mathematical model using the symbols defined on the left. E: Earnings ROI = T: Turnover T = E = S: Sales TI = C: Cost of Sales TI: Total Investment CA: Current Assets FA: Fixed Assets PC: Prod Costs SC: Sales Expense FC: Freight and Delivery AC: Admin Costs 9:48 PM
Transcribed Image Text:11.1.11 Return on investment (ROI) is computed in the following manner: ROI is equal to turnover multiplied by earnings as a percent of sales. Turnover is sales divided by total investment. Total investment is current assets (inventories, accounts receivable, and cash) plus fixed assets. Earnings equal sales minus the cost of sales. The cost of sales consists of variable production costs, selling expenses, freight and delivery, and administrative costs. Complete parts a and b. a. Construct an influence diagram that relates these variables. Choose the correct diagram below. Click here to view influence diagram B) Click here to view influence diagram C. Click here to view influence diagram D. Click here to view influence diagram A. b. Develop a mathematical model using the symbols defined on the left. E: Earnings ROI = T: Turnover T = E = S: Sales TI = C: Cost of Sales TI: Total Investment CA: Current Assets FA: Fixed Assets PC: Prod Costs SC: Sales Expense FC: Freight and Delivery AC: Admin Costs 9:48 PM
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