Alyeska Services Company, a division of a major oil company. provides various se

Question

Alyeska Services Company, a division of a major oil company. provides various services to the operators of the North Slope oil field in Alaska. Data concerning the most recent year appear below: Sales Net operating income Average operating assets $ 17,600,000 $ 5,000,000 $ 36,500,000 Required . Compute the margin for Alyeska Services Company. (Round your answer to 2 decimal places.) argin 2 Compute the turnover for Alyeska Services Company (Round your answer to 2 decimal places.) 3. Compute the return on investment (ROl) for Alyeska Services Company. (Round your intermediate calculations and final answer to 2 decimal places.)

Explanation / Answer

1. Margin = Net operating income / Sales = $5,000,000 / $17,600,000 = 28.41%

2. Turnover = Sales / Average operating assets = $17,600,000 / $36,500,000 = 0.48

3. ROI = Margin * Turnover = 28.41% * 0.48 = 13.64%

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