Question

Nts

eBook
References
industry. Supply the missing data in the table below: (Loss amounts
answers to nearest whole percent.)
Sales
Net operating income
Average operating assets
Return on investment (ROI)
Minimum required rate of return:
Percentage
Dollar amount
Residual income
$
$
$
A
9,600,000
512,000
3,200,000
16 %
14%
Company
B
$8,000,000
$
$
$
350,000
448,000
14%
300,000
%
C
$ 5,400,000
$ 2,160,000
$
%
15 %
108,000

Answer 1

For Company B, the missing Net Operating Income is $1,120,000.

Step-by-step explanation:

The missing data in the table can be calculated using the formula for Return on Investment (ROI), which is the ratio of Net Operating Income (NOI) to Average Operating Assets (AOA).

For Company B, the missing Net Operating Income can be calculated as follows:

Net Operating Income = Sales × ROI

Using the given data:

Sales = $8,000,000

ROI = 14% (0.14 in decimal form)

Plugging in the values:

Net Operating Income = $8,000,000 × 0.14

= $1,120,000