just need teh answer for the two in red in picture 2 actice Assignment Gradebook

Question

just need teh answer for the two in red in picture 2

actice Assignment Gradebook ORION Downloadable eTextbook nment AGE MY INSTRUCTOR FULL SCREEN PRIN Do It! Review 24-4 The service division of Raney Industries reported the following results for 2017. Sales $500,000 Variable costs 300,000 Controllable fixed costs 75,000 Average operating assets 625,000 Management is considering the following independent courses of action in 2018 in order to maximize the return on investment for this division. 1. Reduce average operating assets by $125,000, with no change in controllable margin. 2. Increase sales $100,000, with no change in the contribution margin percentage. DYour answer is correct. Compute the controllable margin and the return on investment for 2017. (Round ROI to 1 decimal place, e.g. 1.5.) Controllable margin Return on investment for 20177 125000 120] % SHOW SOLUTION SHOW ANSWER LINK & IMG_6151.jpg IMG_6149.jpgContacts I IMG_6148.jpg DO LOS PASANDO

Explanation / Answer

Alternative 2 (Increase sales $100000 without change in contribution margin):

Revised Sales = $500000 + $100000 = $600000

Contribution margin = 25%

Contribution = $600000 * 25% = $150000

Average Operating assets = $625000

Expected Return on investment = Contribution / Average Operating assets

= $150000 / $625000

= 24%

Contribution Margin = $150000

Expected Return on investment = 24%

Related Questions

Navigate

• Browse (All)
• Browse J
• Subjects

---

---

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