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Meiji Isetan Corp. of Japan has two regional divisions with headquarters in Osaka and Yokohama. Selected data on the two divisions follow: Division Osaka Yokohama $ 10,400,000 24 520,000 $ 34,000,000 $ 2,380,000 $ 17,000,000 Sales Net operating income Average operating assets $4 2,600,000 Required: 1. For each division, compute the return on investment (ROI) in terms of margin and turnover. 2. Assume that the company evaluates performance using residual income and that the minimum required rate of return for any division is 12%. Compute the residual income for each division. 3. Is Yokohama's greater amount of residual income an indication that it is better managed? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 For each division, compute the return on investment (ROI) in terms of margin and turnover. Osaka Yokohama ROI %

Meiji Isetan Corp. of Japan has two regional divisions with headquarters in Osaka and Yokohama. Selected data on the two divisions follow: Division Osaka Yokohama $ 10,400,000 24 520,000 $ 34,000,000 $ 2,380,000 $ 17,000,000 Sales Net operating income Average operating assets $4 2,600,000 Required: 1. For each division, compute the return on investment (ROI) in terms of margin and turnover. 2. Assume that the company evaluates performance using residual income and that the minimum required rate of return for any division is 12%. Compute the residual income for each division. 3. Is Yokohama's greater amount of residual income an indication that it is better managed? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 For each division, compute the return on investment (ROI) in terms of margin and turnover. Osaka Yokohama ROI %

Cornerstones of Cost Management (Cornerstones Series)
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 16E: A multinational corporation has a number of divisions, two of which are the North American Division...
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Meiji Isetan Corp. of Japan has two regional divisions with headquarters in Osaka and Yokohama. Selected data on the two divisions follow: Division Osaka Yokohama Sales $ 10,400,000 $ 34,000,000 2$ Net operating income Average operating assets $4 520,000 2,380,000 $4 2,600,000 $ 17,000,000 Required: 1. For each division, compute the return on investment (ROI) in terms of margin and turnover. 2. Assume that the company evaluates performance using residual income and that the minimum required rate of return for any division is 12%. Compute the residual income for each division. 3. Is Yokohama's greater amount of residual income an indication that it is better managed? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 For each division, compute the return on investment (ROI) in terms of margin and turnover. Osaka Yokohama ROI % % < Prev 4 of 5 Next > Desktop o search
Transcribed Image Text:Meiji Isetan Corp. of Japan has two regional divisions with headquarters in Osaka and Yokohama. Selected data on the two divisions follow: Division Osaka Yokohama Sales $ 10,400,000 $ 34,000,000 2$ Net operating income Average operating assets $4 520,000 2,380,000 $4 2,600,000 $ 17,000,000 Required: 1. For each division, compute the return on investment (ROI) in terms of margin and turnover. 2. Assume that the company evaluates performance using residual income and that the minimum required rate of return for any division is 12%. Compute the residual income for each division. 3. Is Yokohama's greater amount of residual income an indication that it is better managed? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 For each division, compute the return on investment (ROI) in terms of margin and turnover. Osaka Yokohama ROI % % < Prev 4 of 5 Next > Desktop o search
Meiji Isetan Corp. of Japan has two regional divisions with headquarters in Osaka and Yokohama. Selected data on the two divisions follow: Division Osaka $ 10,400,000 $ 34,000,000 520,000 $ 2,600,000 Yokohama Sales Net operating income Average operating assets 24 2,380,000 $ $ 17,000,000 Required: 1. For each division, compute the return on investment (ROI) in terms of margin and turnover. 2. Assume that the company evaluates performance using residual income and that the minimum required rate of return for any division is 12%. Compute the residual income for each division. 3. Is Yokohama's greater amount of residual income an indication that it is better managed? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Assume that the company evaluates performance using residual income and that the minimum required rate of return for any division is 12%. Compute the residual income for each division. Osaka Yokohama Residual income < Prev. 4 of 5 Next > Desktop to search SUS
Transcribed Image Text:Meiji Isetan Corp. of Japan has two regional divisions with headquarters in Osaka and Yokohama. Selected data on the two divisions follow: Division Osaka $ 10,400,000 $ 34,000,000 520,000 $ 2,600,000 Yokohama Sales Net operating income Average operating assets 24 2,380,000 $ $ 17,000,000 Required: 1. For each division, compute the return on investment (ROI) in terms of margin and turnover. 2. Assume that the company evaluates performance using residual income and that the minimum required rate of return for any division is 12%. Compute the residual income for each division. 3. Is Yokohama's greater amount of residual income an indication that it is better managed? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Assume that the company evaluates performance using residual income and that the minimum required rate of return for any division is 12%. Compute the residual income for each division. Osaka Yokohama Residual income < Prev. 4 of 5 Next > Desktop to search SUS
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