Gauntlett Inc. reported the following results from last year's operations:
At the beginning of this year, the company has a $1,300,000 investment opportunity with the following characteristics:

-If the company pursues the investment opportunity and otherwise performs the same as last year,the combined turnover for the entire company will be closest to:
A) 12.83
B) 2.65
C) 1.90
D) 3.34

Question

Gauntlett Inc. reported the following results from last year's operations:
  At the beginning of this year, the company has a $1,300,000 investment opportunity with the following characteristics:
 
-If the company pursues the investment opportunity and otherwise performs the same as last year,the combined turnover for the entire company will be closest to:
A) 12.83 
B) 2.65 
C) 1.90 
D) 3.34

Quizplus · Accepted Answer

Sales = $12,000,000 + $4,680,000 = $16,680,000
Average operating assets = $5,000,000 + $1,300,000 = $6,300,000
Turnover = Sales ÷ Average operating assets = $16,680,000 ÷ $6,300,000 = 2.65