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Adams Corporations balance sheet indicates that the company has $510,000 invested in operating assets. During 2018, Adams earned operating income of $52,020 on $1,020,000 of sales.

Required

1. Compute Adamss profit margin for 2018.

2. Compute Adamss turnover for 2018.

3. Compute Adamss return on investment for 2018.

4. Recompute Adamss ROI under each of the following independent assumptions: (1) Sales increase from $1,020,000 to $1,224,000, thereby resulting in an increase in operating income from $52,020 to $55,080. (2) Sales remain constant, but Adams reduces expenses, resulting in an increase in operating income from $52,020 to $54,060. (3) Adams is able to reduce its invested capital from $510,000 to $408,000 without affecting operating income.

Complete this question by entering your answers in the tabs below.

• Req A to C
• Req D

Compute Adamss profit margin, turnover and return on investment for 2018. (Round "Profit margin" and "Return on investment" to 1 decimal place.)

	a. Profit margin % b. Turnover times c. Return on investment %

Recompute Adamss ROI under each of the following independent assumptions: (Do not round intermediate calculations. Round your answers to 2 decimal places. (i.e., .2345 should be entered as 23.45).)

1. (1) Sales increase from $1,020,000 to $1,224,000, thereby resulting in an increase in operating income from $52,020 to $55,080.

   (2) Sales remain constant, but Adams reduces expenses, resulting in an increase in operating income from $52,020 to $54,060.

   (3) Adams is able to reduce its invested capital from $510,000 to $408,000 without affecting operating income.

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	Return on Investment (1) % (2) % (3) %

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