Given the following information for the Zenith Division:
$\begin{array}{ll}
\text { Asset base } & \$ 500,000 \
\text { Sales Revenues } & \$ 725,000 \
\text { Expenses } & \$ 662,500
\end{array}$
a.What are the margin,turnover,and ROI for Zenith Division?
b.Zenith has an option to make an additional investment that would add $100,000 to the asset base.It would generate an additional $50,000 in sales revenue and no additional expenses.What would be the effect on margin,turnover,and ROI?
c.Another alternative (independent of alternative 'b')for Zenith is to run an advertising campaign that would require additional advertising expenses of $37,500,but the best estimate is the campaign would generate an additional $75,000 of revenue.What would be the effect on margin,turnover,and ROI?

Question

Given the following information for the Zenith Division:
 $\begin{array}{ll}
\text { Asset base } & \$ 500,000 \
\text { Sales Revenues } & \$ 725,000 \
\text { Expenses } & \$ 662,500
\end{array}$ 
a.What are the margin,turnover,and ROI for Zenith Division?
b.Zenith has an option to make an additional investment that would add $100,000 to the asset base.It would generate an additional $50,000 in sales revenue and no additional expenses.What would be the effect on margin,turnover,and ROI?
c.Another alternative (independent of alternative 'b')for Zenith is to run an advertising campaign that would require additional advertising expenses of $37,500,but the best estimate is the campaign would generate an additional $75,000 of revenue.What would be the effect on margin,turnover,and ROI?

Quizplus · Accepted Answer

The Answer of Given the following information for the Zenith Division:
 $\begin{array}{ll}
\text { Asset base } & \$ 500,000 \
\text { Sales Revenues } & \$ 725,000 \
\text { Expenses } & \$ 662,500
\end{array}$ 
a.What are the margin,turnover,and ROI for Zenith Division?
b.Zenith has an option to make an additional investment that would add $100,000 to the asset base.It would generate an additional $50,000 in sales revenue and no additional expenses.What would be the effect on margin,turnover,and ROI?
c.Another alternative (independent of alternative 'b')for Zenith is to run an advertising campaign that would require additional advertising expenses of $37,500,but the best estimate is the campaign would generate an additional $75,000 of revenue.What would be the effect on margin,turnover,and ROI?