Selected operating data for two divisions of Outback Brewing, Ltd., of Australia are given below (thec urrency is the Australian dollar, denoted here as $):DivisionNew SouthQueensland WalesSales ............................................................. $4,000,000 $7,000,000Average operating assets ............................. $2,000,000 $2,000,000Net operating income ................................... $360,000 $420,000Property, plant, and equipment (net) ............ $950,000 $800,000Required:1. Compute the rate of return for each division using the return on investment (ROI) formula stated interms of margin and turnover.2. Which divisional manager seems to be doing the better job? Why?

Selected operating data for two divisions of Outback Brewing, Ltd., of Australia are given below (thec urrency is the Australian dollar, denoted here as $):DivisionNew SouthQueensland WalesSales ............................................................. $4,000,000 $7,000,000Average operating assets ............................. $2,000,000 $2,000,000Net operating income ................................... $360,000 $420,000Property, plant, and equipment (net) ............ $950,000 $800,000Required:1. Compute the rate of return for each division using the return on investment (ROI) formula stated interms of margin and turnover.2. Which divisional manager seems to be doing the better job? Why?

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter10: Cost Analysis For Management Decision Making

Section: Chapter Questions

Problem 6P: Arctic Software Inc. has two product lines. The income statement for the year ended December 31...

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Selected operating data for two divisions of Outback Brewing, Ltd., of Australia are given below: Division Queensland New South Wales Sales $ 1,219,000 $ 2,550,000 Average operating assets $ 530,000 $ 510,000 Net operating income $ 73,140 $ 76,500 Property, plant, and equipment (net) $ 253,000 $ 203,000 Required: 1. Compute the rate of return for each division using the return on investment (ROI) formula stated in terms of margin and turnover. 2. Which divisional manager seems to be doing the better job?
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