Question

Jaymes Corporation produces high-performance rotors. It expects to produce 69,000 rotors in the coming year. It has invested $8,970,000 to produce rotors. The company has a required return on investment of 20%. What is its ROI per unit

Answer 1

$26

Step-by-step explanation:

The computation of the ROI per unit is shown below

Required ROI on the total Investment

= Total Investment × Required Rate on Investment

= $8,970,000 × 20%

= $1,794,000

So, ROI Per Unit is

= Required Return on investmnt ÷ Total Rotors

= $1,794,000 ÷ 69,000

= $26