Tan Corporation of Japan has two regional divisions with headquarters in Osaka and Yokohama. Selected data on the two divisions follow. Division Osaka $ १,600,000 । 26,000,000 Yokohama Sales Net operating income Average operating assets 672,000 $ 2,340,000 $ 3,200,000 $ 13,000,000 %24 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 16%. Compute the residual income for each division. Complete this question by entering your answers in the tabs below.

Tan Corporation of Japan has two regional divisions with headquarters in Osaka and Yokohama. Selected data on the two divisions follow. Division Osaka $ १,600,000 । 26,000,000 Yokohama Sales Net operating income Average operating assets 672,000 $ 2,340,000 $ 3,200,000 $ 13,000,000 %24 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 16%. Compute the residual income for each division. Complete this question by entering your answers in the tabs below.

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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