Question

Campbell Candy Corporation desires a 16% return on investment on all operations. The following information was available for the company for the current year. Sales $250,000 Operating Income $70,000 Turn over 0.6% What is he corporation's ROI? A) Impossible to determine from the information given. B) 28% C) 16.8% D) 32%

Answer 1

corporation's ROI = 16.8 %

Step-by-step explanation:

given data

return on investment = 16%

Operating Income = $70,000

Sales = $250,000

Turn over = 0.6%

to find out

What is he corporation's ROI

solution

we get here Average operating assets that is express as

Average operating assets =
`(Sales)/(Turn\ over)`

Average operating assets =
`(250000)/(0.6)`

Average operating assets = 416666.6667

so corporation's ROI will be

corporation's ROI =
`(Operating\ income)/(Average\ operating\ assets)`

corporation's ROI =
`(70000)/(416666.6667)`

corporation's ROI =
`(70000)/(416666.6667)`

corporation's ROI = 16.8 %