investment of $110,000. This investment would earn $13,200 for the company. Read the requirements. Requirement...
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investment of $110,000. This investment would earn $13,200 for the company. Read the requirements. Requirement 1. What is the original return on investment (ROI) for Hoffman Ceramics (before making any additional investment)? First determine the formula to calculate the ROI. Requirements 1. What is the original return on investment (ROI) for Hoffman Ceramics (before making any additional investment)? 2. What would the ROI be for Hoffman Ceramics if this investment opportunity were undertaken? Would the manager of the Hoffman Ceramics division want to make this investment if she were evaluated based on ROI? Why or why not? 3. What is the ROI of the investment opportunity? Would the investment be desirable from the standpoint of Fielding Corporation? Why or why not? 4. What would the residual income (RI) be for Hoffman Ceramics if this investment opportunity were to be undertaken? Would the manager of the Hoffman Ceramics division want to make this investment if she were evaluated based on RI? Why or why not? 5. What is the RI of the investment opportunity? Would the investment be desirable from the standpoint of Fielding Corporation? Why or why not? 6. Which performance measurement method, ROI or RI, promotes goal congruence? Why
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