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 $ 18,700,000 Net operating income $ 6,100,000 Average operating assets $ 36,500,000 Required: 1. Compute the margin for Alyeska Services Company. (Round your answer to 2 decimal places.) 2. Compute the turnover for Alyeska Services Company. (Round your answer to 2 decimal places.) 3. Compute the return on investment (ROI) for Alyeska Services Company. (Round your intermediate calculations and final answer to 2 decimal places.)

Explanation / Answer

1. Compute the margin for Alyeska Services Company.

Margin = 6100000*100/18700000 = 32.62%

2. Compute the turnover for Alyeska Services Company.

Turnover = 18700000/36500000 = 0.51

3. Compute the return on investment (ROI) for Alyeska Services Company.

ROI = 6100000*100/36500000 = 16.71%

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