Homework Help is Here – Start Your Trial Now!
Business
Accounting
Water Paints Inc. has two major Divisions and has collected the following information about them.     Net Sales revenue Operating income Average Total Assets   Stores $3,989,000 $480,000 $1,250,000 Consumer   1,425,000   185,000    1,500,000   Required: Calculate each Division’s ROI rounding all of your answers to three decimal places. Calculate each Division’s profit margin ratio. What do your results mean? Calculate each Division’s asset turnover ratio.

Water Paints Inc. has two major Divisions and has collected the following information about them.     Net Sales revenue Operating income Average Total Assets   Stores $3,989,000 $480,000 $1,250,000 Consumer   1,425,000   185,000    1,500,000   Required: Calculate each Division’s ROI rounding all of your answers to three decimal places. Calculate each Division’s profit margin ratio. What do your results mean? Calculate each Division’s asset turnover ratio.

Financial And Managerial Accounting
Financial And Managerial Accounting
15th Edition
ISBN:9781337902663
Author:WARREN, Carl S.
Publisher:WARREN, Carl S.
Chapter24: Evaluating Decentralized Operations
Section: Chapter Questions
Problem 3MAD: Papa Johns International, Inc. (PZZA), operates over 5,000 restaurants in the United States and 45...
See similar textbooks
icon
Related questions
Question

Problem 2

Water Paints Inc. has two major Divisions and has collected the following information about them.

 

 

Net Sales revenue

Operating income

Average Total Assets

 

Stores

$3,989,000

$480,000

$1,250,000

Consumer

  1,425,000

  185,000

   1,500,000

 

Required:

  1. Calculate each Division’s ROI rounding all of your answers to three decimal places.
  2. Calculate each Division’s profit margin ratio. What do your results mean?
  3. Calculate each Division’s asset turnover ratio.
  4. Calculate each Division’s residual income (RI)
Expert Solution
steps

Step by step

Solved in 4 steps

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Knowledge Booster
Divisional performance management
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
Financial And Managerial Accounting
Financial And Managerial Accounting
Accounting
ISBN:
9781337902663
Author:
WARREN, Carl S.
Publisher:
Cengage Learning,
Managerial Accounting
Managerial Accounting
Accounting
ISBN:
9781337912020
Author:
Carl Warren, Ph.d. Cma William B. Tayler
Publisher:
South-Western College Pub
Cornerstones of Financial Accounting
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning
Survey of Accounting (Accounting I)
Survey of Accounting (Accounting I)
Accounting
ISBN:
9781305961883
Author:
Carl Warren
Publisher:
Cengage Learning
SEE MORE TEXTBOOKS