Camden Corporation has operating income of $87,000,a sales margin of 15%,and capital turnover of 2.5.The return on investment (ROI)for Camden Corporation may be closest to
A)6%.
B)38%.
C)107%.
D)2%.

Question

Quizplus · Accepted Answer

B)
Operating income/Sales Margin = Sales
87,000/15% = 580,000
Sales/Capital Turnover = Total Assets
580,000/2.5 = 232,000
Operating income/Total Assets = ROI
87,000/232,000 = 38%

Camden Corporation Has Operating Income of $87,000,a Sales Margin of 15%,and