Using the case study on page 32 of the text, what would be the ROI for the Sales

Question

Using the case study on page 32 of the text, what would be the ROI for the Sales Department Option if the anticipated additional sales revenue was $650,000 and all other variables were unchanged?


Using the case study on page 32 of the text, what would be the Payback for the Sales Department Option if the anticipated additional sales revenue was $650,000 and all other variables were unchanged?

in protit ti Sales department Maintenance de $75,000 per Year 100% = $75.000m 1 year- tem Return per year Revenue * net profit % $500,000 * 7% = $35,000 ROI: Return per year Investment 35% $35,000/100,000 Payback: Investment/ Return per year 2.87 years- 100,00/$35,000 $75,000/$75,000 Figure 3.2 Comparing Results from Investments

Explanation / Answer

Total sales revenue = 500000+650000 = 1150,000

Return per year = Revenue*net profit

= 1150000*7% = 80,500

ROI = Return per year/Investment

=80,500/100,000 = 80.5%

Payback = Investment/Return per year

100,000/80,500 = 1.24years

Related Questions

Navigate

• Browse (All)
• Browse U
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.