Question

The electronics division of anton company reports the following results for the current year:

revenues $ 800,000
operating expenses $ 656,000
operating income $ 144,000
operating assets $ 1,200,000

Anton company has set a target return on investment (roi) of 11% for the electronics electronic division's margin is:
a. 66.7%.
b. 18%.
c. 11.25%.
d. 12%

Answer 1

Based on the available information, and the options, the correct answer is b. 18%.

To calculate the margin for the electronics division of Anton Company, divide the operating income by the revenues.

Margin = (Operating Income / Revenues) * 100

Given:

Operating Income = $144,000

Revenues = $800,000

Margin = (144,000 / 800,000) * 100

Margin = 0.18 * 100

Margin = 18%

Therefore, the margin for the electronics division of Anton Company is 18%.

The correct answer is b. 18%.