Question

The Electronics Division of Apex Company reports the following results for 2014: Revenues $517,000 Operating expenses $464,000 Operating income $ 53,000 Operating assets $630,000 Apex Company has set a target return on investment (ROI) of 11% for the Electronics Division. The Electronic Division's return on investment is:

Answer 1

The Electronic division is 8.41% this is below their target return on investment

Step-by-step explanation:

Revenues 517,000

Expenses 464,000

Operating Income 53,000

Assets 630,000

Return on investment for the electronic division

operating income/ operating assets

53,000/630,000 = 0.084126984 = 8.41%

The company expect to yield 9% per dolalr investment

the electronic division has a yield of 8.41% which is below that.