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Concord Corporation recorded operating data for its Waterhole division for the year. Concord requires a...

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Accounting

Concord Corporation recorded operating data for its Waterhole division for the year. Concord requires a 8.00% rate of return.
Sales
$494000
Controllable margin
86000
Total average assets
344000
Fixed costs
26000
Residual income
47000
Suppose Concord experiences an increase of $47000 in controllable fixed costs. Will the new ROI be acceptable?
There is not enough information to determine the new ROI.
Yes. The new ROI is still above the required ROI.
Yes. The ROI will remain at 25% which exceeds the required ROI.
No. The ROI drops to less than 8.00%.

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