Question

Buff Company had average operating assets of $580,000 and sales of $196,000 last year. If the controllable margin was $26,000, what was the ROI

Answer 1

4.5

Step-by-step explanation:

The average operating assets is $580,000

The sales from last year is $196,000

The controllable margin was $26,000

Therefore the ROI can be calculated as follows

= 26,000/580,000

= 0.045×100

= 4.5

Hence the ROI is 4.5%