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Sage Division's Operating Results Include \bullet Controllable Margin $300000 \bullet Sales Revenue $2400000

Question 165

Essay

Sage Division's operating results include:
\bullet Controllable margin $300000
\bullet Sales revenue $2400000
\bullet Operating assets $1000000
Sage is considering a project with sales of $240000 expenses of $168000 and an investment of $360000. Sage's required rate of return is 15%.
Instructions
Determine whether Sage should accept this project.

Correct Answer:

verifed

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Current ROI = $300000 ÷ $1000000 = 30%
R...

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