Required Information Use the following information for the Exercises below [The

Question

Required Information Use the following information for the Exercises below [The following information applies to the questions displayed below.j Megamart, a retailer of consumer goods, provides the following information on two of its departments (each considered an investment center). Average Invested AssetS $16,000,000 Sales Income Investment Center Electronics Sporting goods $40,000,000 $2,880,000 20,000,000 2,040,000 12,000,000 Exercise 24-11 Computing margin and turnover; department efficiency LO A2 Compute profit margin and investment turnover for each department. Which department generates the most net income per dollar of sales? Which department is most efficient at generating sales from average invested assets? Complete this question by entering your answers in the tabs below Profit Marginover Compute investment turnover for each department. Which department is most efficient at generating sales from average invested assets? Investment Turnover Choose Numerator: Choose Denominator: = | Investment Turnover Center Electronics Sporting Goods Which department is most efficient at generating sales from average invested assets? K Profit Margin Investment Turnover>

Explanation / Answer

Sales/Average invested assets = Investment turnover Electronics 40000000/16000000= 2.5 Sporting Goods 20000000/12000000= 1.67 Electronics department is more efficient 2 Income/Sales = Profit margin Electronics 2880000/40000000=7.2% Sporting Goods 2040000/12000000=17% Sporting Goods generated more income per dollar of sales

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