Clydesdale Company has sales of $4,500,000, invested assets of $2,000,000, and operating expenses of $3,600,000. The company has established a minimum return on investment of 7%.Clydesdale Company's residual income isa.$252,000b.$900,000c.$760,000d.$1,400,000

Residual Income: It is the portion of income after reducing the minimum return on the…

Answered: Clydesdale Company's residual income is

Business

Finance

Clydesdale Company's residual income is

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter14: Decentralized Operations

Section: Chapter Questions

Problem 3SEQ: Division A of Kern Co. has sales of $350,000, cost of goods sold of $200,000, operating expenses of...

See similar textbooks

Related questions

Q: East Mullett Manufacturing earned operating income last year as shown in the following income…

A: EVA = Net operating profit after tax - (WACC * Captial invested) Net operating profit after tax =…

Q: A company's divislon has sales of $6,000,000, Income of $240,000, and average assets of $4,800.000.…

A: Financial ratios are used to check different aspects of a company - liquidity, solvency, etc. They…

Q: Blaser Corporation had $1,017,000 in invested assets, sales of $1,284,000, operating income…

A: Ratio analysis is a method of measuring the financial position of the organization with different…

Q: The Marine Division of Pacific Corp. has average invested assets of $110,000,000. Sales revenue of…

A: Residual income = Operating income - (Average invested assets x Hurdle rate)

Q: Mason Corporation had $1,096,000 in invested assets, sales of $1,237,000, income from operations…

A: The residual income is the amount of profit earned even after the completion of the work that was…

Q: Sales revenue for XYZ Company is $1,000,000. The cost of goods sold is $450,000 and the operating…

A: Thus, the net operating income is $300,000.

Q: The profit margin for Mason Corporation is

A: Profit Margin: It is a measure of profitability for the business. Higher the ratio, the better the…

Q: Briggs Company has operating income of $45,760, invested assets of $143,000, and sales of $457,600.…

A: Return on investment helps in measuring the efficiency of the amount invested in a particular…

Q: Blaser Corporation had $1,092,000 in invested assets, sales of $1,214,000, income from operations…

A: Return on investment = Income from operation / Average investment where, Average investment =…

Q: Ralston Company has operating income of $75,000, invested assets of $360,000, and sales of $790,000.…

A: DuPont Analysis states that return on equity is equal to margin of profits which is multiplied by…

Q: Solano Company has sales of $520,000, cost of goods sold of $380,000, other operating expenses of…

A: The term "residual income" refers to money earned after the income-generating work has been…

Q: Mason Corporation had $1,077,000 in invested assets, sales of $1,209,000, income from operations…

A: The residual income is the income the company is earning over and above what it should earn.…

Q: Mason Corporation had $1,182,000 in invested assets, sales of $1,298,000, operating income amounting…

A: Investment turnover: This ratio gauges the operating efficiency by quantifying the amount of sales…

Q: Accounting Assume a company reported the following results: Sales $ 400,000 Variable expenses…

A: Lets understand the meaning of residual income. Residual income is an income earned over minimum…

Q: San Francisco Sea Corp. has sales of $1,550,000, cost of goods sold of $820,000, other operating…

A: Return on investment is the ratio which indicates how much percentage of return a firm is able to…

Q: Mason Corporation had $1,046,000 in invested assets, sales of $1,280,000, operating income amounting…

A: Residual income of the business means, income over and above its, minimum desired rate of return.

Q: The Holmes Division recorded operating data as follows for the past year: Sales Operating Income…

A: Minimum required rate of return is the return which companies wants and have to have earn because it…

Q: Mason Corporation had $1,152,000 in invested assets, sales of $1,279,000, operating income amounting…

A: INVESTMENT TURNOVER : = NET SALES / ( EQUITY + DEBT ) = NET SALES / INVESTED ASSETS

Q: Mason Corporation had $1,164,000 in invested assets, sales of $1,298,000, operating income amounting…

A: Definition: Investment turnover: This ratio gauges the operating efficiency by quantifying the…

Q: Solano Company has sales of $740.000, cost of goods sold of $490,000, other operating expenses of…

A: Return on investment = Net profit/Average invested assets Investment turnover = Net sales/Average…

Q: The Marine Division of Pacific Corp. has average invested assets of $120,000,000. Sales revenue of…

A: Return on investment = Operating income / Average invested assets where, Average invested assets =…

Q: 1)Blaser Corporation had $1,029,000 in invested assets, sales of $1,264,000, income from operations…

A: Return on investment = Income from operations / Invested assets

Q: Avocado Company has an operating income of $100,800 on revenues of $1,013,000. Average invested…

A: Return on Investment is a ratio that shows the relationship between net profit and the cost of…

Q: The Auto Division of Big Department Store has a net operating income of $660, a net asset base of…

A: Residual income: Residual income means the excess of income earned over the desired income. Desired…

Q: NUBD Division reported a residual income of P200,000 for the year just ended. The division had…

A: Answer - Formula - Residual Income = Operating Income - ( Capital Invested * Target Rate of…

Q: Sam Division reported a residual income of P200,000 for the year just ended. The division had…

A: Residual income = Net operating income - invested capital x required rate of return required rate of…

Q: Clydesdale Company has sales of $4,500,000, invested assets of $2,000,000, and operating expenses of…

A: First, compute the operating income as shown below: Operating income = Sales - Operating expense…

Q: 66. JSW Corporation had $1,100,000 in invested assets, sales of $1,210,000, income from operations…

A: “Since you have asked multiple question, we will solve the first question for you. If you want any…

Q: Sales revenue for XYZ Company is $1,000,000. The cost of goods sold is $450,000 and the operating…

A: The following calculations are done in the records of XYZ Company to evaluate the residual income of…

Q: Marshall Corporation had $220,000 in invested assets, sales of $242,000, operating income of…

A: Return on Investment = Net income/Average invested assets where, Average invested assets =…

Q: Mason Corporation had $1,027,000 in invested assets, sales of $1,215,000, operating income amounting…

A: Investment turnover: The investment turnover ratio compares the revenues produced by a business to…

Q: Oman Company has net working capital of $6,900, net fixed assets of $86,100, sales of $156,000, and…

A: Current assets = working capital + current liabilities = 6900+ 4 1700 = $48600

Q: Bottlebrush Company has operating income of $49,749, invested assets of $309,000, and sales of…

A: Formulas: Profit margin = Operating income / Sales ------------------------------ Investment…

Q: Polymer Coating Enterprises has an operating income of $100,000 on revenues of $1,000,000. Average…

A: Lets understand the basics. Residual income is a net income generated over and above of minimum…

Q: requires a minimum return on its investments of 15%, what is their residual income? NUBD Co has the…

Q: Mason Corporation had $1,104,000 in invested assets, sales of $1,285,000, operating income amounting…

A: The return on investment is a measure used by the company to calculate the percentage of earning on…

Q: The Bottlebrush Company has income from operations of $48,312, invested assets of $122,000, and…

Q: What is the Residual Income for Stevenson Corporation, given the following info: Invested Assets =…

A: Residual income is the excess of income over the minimum required rate of return. It indicates the…

Q: Mason Corporation had $1,030,000 in invested assets, sales of $1,283,000, operating income amounting…

A: Ratio analysis is a method of measuring the financial position of the organization with different…

Q: Assume a company had net operating income of $300,000, sales of $1,500,000, residual income of…

A: Average operating assets is calculated as minimum required return in dollars dividend by minimum…

Q: Last year a company had sales of $400,000, average operating assets of $166,667, and a return on…

A: Return on investment = net operating income for the year / average operating assets where, Average…

Q: Mason Corporation had $1,162,000 in invested assets, sales of $1,265,000, operating income amounting…

A: The profit margin is evaluated after dividing the net income as a numerator by the total sales as a…

Question

Clydesdale Company has sales of $4,500,000, invested assets of $2,000,000, and operating expenses of $3,600,000. The company has established a minimum return on investment of 7%.

Clydesdale Company's residual income is

a.$252,000

b.$900,000

c.$760,000

d.$1,400,000

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step 3

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Similar questions

During the current year, Sokowski Manufacturing earned income of $350,000 from total sales of $5,500,000 and average capital assets of $12,000, 000. What is the sales margin?
Division A of Kern Co. has sales of $350,000, cost of goods sold of $200,000, operating expenses of $30,000, and invested assets of $600000. What is the return on investment for Division A? A. 20% B. 25% C. 33% D. 40%
During the current year, Sokowski Manufacturing earned income of $350,000 from total sales of $5,500,000 and average capital assets of $12,000,000. A. Based on this information, calculate asset turnover. B. Using the sales margin from the previous exercise, what is the total ROI for the company during the current year?
Brandt Corporation had sales revenue of 500,000 for the current year. For the year, its cost of goods sold was 240,000, its operating expenses were 50,000, its interest revenue was 2,000, and its interest expense was 12,000. Brandts income tax rate is 30%. Prepare Brandts multiple-step income statement for the current year.
Margin, Turnover, Return on Investment, Average Operating Assets Elway Company provided the following income statement for the last year: At the beginning of last year, Elway had 28,300,000 in operating assets. At the end of the year, Elway had 23,700,000 in operating assets. Required: 1. Compute average operating assets. 2. Compute the margin and turnover ratios for last year. (Note: Round the answer for margin ratio to two decimal places.) 3. Compute ROI. (Note: Round answer to two decimal places.) 4. CONCEPTUAL CONNECTION Briefly explain the meaning of ROI. 5. CONCEPTUAL CONNECTION Comment on why the ROI for Elway Company is relatively high (as compared to the lower ROI of a typical manufacturing company).
Mason Corporation had $1,098,000 in invested assets, sales of $1,257,000, operating income amounting to $246,000, and a desired minimum return on investment of 15%. The residual income for Mason Corporation is a.$113,820 b.($6,000) c.$0 d.$81,300
Mason Corporation had $1,096,000 in invested assets, sales of $1,237,000, income from operations amounting to $203,000, and a desired minimum rate of return of 15%. The residual income for Mason Corporation is a.$38,600 b.$54,040 c.$0 d.($5,300)
Mason Corporation had $1,027,000 in invested assets, sales of $1,215,000, operating income amounting to $236,000, and a desired minimum return on investment of 15%. The investment turnover for Mason Corporation is a.0.95 b.1.42 c.1.77 d.1.18
Clydesdale Company has sales of $4,500,000, invested assets of $2,000,000, and operating expenses of $3,600,000. The company has established a minimum return on investment of 7%. Clydesdale Company's profit margin is a.20% b.44.4% c.18% d.80%
The following data pertain to Waramutse's most recent year of operations. Income $ 12,500,000 Sales revenue 220,000,000 Average invested capital 51,000,000 Assume that the company’s minimum desired rate of return on invested capital is 11 percent. Required: Compute Waramutse’s residual income for the year
Mason Corporation had $1,046,000 in invested assets, sales of $1,280,000, operating income amounting to $227,000, and a desired minimum return on investment of 13%. The residual income for Mason Corporation is
Mason Corporation had $1,077,000 in invested assets, sales of $1,209,000, income from operations amounting to $238,000, and a desired minimum return of 12%. The residual income for Mason Corporation is a.$108,760 b.($5,300) c.$0 d.$152,264