ROI, Margin, Turnover Jarriot, Inc., presented two years of data for its Furniture Division and its Houseware Division. Furniture Division: Year 1 Year 2 Sales $33,870,000 $36,210,000 Operating income 1,422,540 1,520,820 Average operating assets 10,000,000 10,000,000 Houseware Division: Year 1 Year 2 Sales $12,590,000 $13,139,800 Operating income 604,320 499,312 Average operating assets 5,000,000 5,000,000 Required: Round the ROI and margin percentages to two decimal places (for example, enter the decimal .10555 as "10.56" percent). Round the turnover ratio to two decimal places. 1. Compute the ROI and the margin and turnover ratios for each year for the Furniture Division. Furniture Division ROI Margin Turnover Year 1 % % Year 2 % % 2. Compute the ROI and the margin and turnover ratios for each year for the Houseware Division. Houseware Division ROI Margin Turnover Year 1 % % Year 2 % % 3. Indicate the reason for change in ROI from Year 1 to Year 2 for the Furniture Division. Indicate the reason for change in ROI from Year 1 to Year 2 for the Houseware Division.
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
Jarriot, Inc., presented two years of data for its Furniture Division and its Houseware Division.
Furniture Division:
| Year 1 | Year 2 | |
| Sales | $33,870,000 | $36,210,000 |
| Operating income | 1,422,540 | 1,520,820 |
| Average operating assets | 10,000,000 | 10,000,000 |
Houseware Division:
| Year 1 | Year 2 | |
| Sales | $12,590,000 | $13,139,800 |
| Operating income | 604,320 | 499,312 |
| Average operating assets | 5,000,000 | 5,000,000 |
Required:
Round the ROI and margin percentages to two decimal places (for example, enter the decimal .10555 as "10.56" percent). Round the turnover ratio to two decimal places.
1. Compute the ROI and the margin and turnover ratios for each year for the Furniture Division.
| Furniture Division | |||
| ROI | Margin | Turnover | |
| Year 1 | % | % | |
| Year 2 | % | % |
2. Compute the ROI and the margin and turnover ratios for each year for the Houseware Division.
| Houseware Division | |||
| ROI | Margin | Turnover | |
| Year 1 | % | % | |
| Year 2 | % | % |
3. Indicate the reason for change in ROI from Year 1 to Year 2 for the Furniture Division.
Indicate the reason for change in ROI from Year 1 to Year 2 for the Houseware Division.
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