What is the return on investment for Division A?
A) 9.3%
B) 99.3%
C) 74.6%
D) 4.6%

Name: What is the return on investment for Division A? A) 9.3% B) 99.3% C) 74.6% D) 4.6%
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Question

Quizplus · Accepted Answer

Division A's return on investment is calculated by dividing its net income ($1,860,000) by its initial investment ($20,000,000) and multiplying by 100. This results in a return on investment of 9.3%, which is higher than the cost of capital (8%). Therefore, investing in Division A would be a profitable choice.

What Is the Return on Investment for Division A