The Calculating Fashion Company has two operating divisions: North and South.The following information was collected from its financial statements.$$\begin{array} { | l | r | r | }
\hline & \text { North } & \text { South } \
\hline \text { Operating inc ome } & \$ 15,375 & \$ 9,160 \
\hline \text { Sales } & 90,100 & 128,445 \
\hline \text { Average operating assets } & 47,620 & 37,690 \
\hline
\end{array}$$ Required:
Compute the following ratios for each division:
a.Profit margin
b.Asset turnover
c.Return on investment (ROI)

Question

The Calculating Fashion Company has two operating divisions: North and South.The following information was collected from its financial statements.$$\begin{array} { | l | r | r | } 
\hline & \text { North } & \text { South } \
\hline \text { Operating inc ome } & \$ 15,375 & \$ 9,160 \
\hline \text { Sales } & 90,100 & 128,445 \
\hline \text { Average operating assets } & 47,620 & 37,690 \
\hline
\end{array}$$ Required:
Compute the following ratios for each division:
a.Profit margin
b.Asset turnover
c.Return on investment (ROI)

Quizplus · Accepted Answer

The Answer of The Calculating Fashion Company has two operating divisions: North and South.The following information was collected from its financial statements.$$\begin{array} { | l | r | r | } 
\hline & \text { North } & \text { South } \
\hline \text { Operating inc ome } & \$ 15,375 & \$ 9,160 \
\hline \text { Sales } & 90,100 & 128,445 \
\hline \text { Average operating assets } & 47,620 & 37,690 \
\hline
\end{array}$$ Required:
Compute the following ratios for each division:
a.Profit margin
b.Asset turnover
c.Return on investment (ROI)

The Calculating Fashion Company Has Two Operating Divisions: North and South.The