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QUESTION 5: 20 marks SHOW ALL SUPPORTING CALCULATIONS FOR THIS PROBLEM. NO MARKS WILL BE...

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QUESTION 5: 20 marks SHOW ALL SUPPORTING CALCULATIONS FOR THIS PROBLEM. NO MARKS WILL BE AWARDED FOR ANSWERS TO THE PROBLEMS UNSUPPORTED BY CLEARLY SHOWN CALCULATIONS. ROUND ALL CALCULATIONS UP TO FOUR DECIMAL PLACES. Megatron Technologies Inc. is a national semi-conductor chip manufacturer and retailer that supplies microchips to various industries such as the automotive industry, the aerospace industry, and the computing industry. Presented below is information pertaining to two of its largest divisions, Automotive and Aerospace (in thousands of dollars): Automotive Aerospace Sales $4,970,000 $1,300,000 Operating Income $905,000 $190,000 Total Assets $3,168,000 $2,040,000 Megatron has a specified target rate of return of 20%. Requirements (round all calculations to four decimal places): 1. Calculate each division's ROI. 3 marks 2. Calculate each division's profit margin. Interpret your results. 4 marks 3. Calculate each divisions asset turnover. Interpret yours results. 4 marks 4. Use the expanded ROI formula to confirm your results from Requirement 1. Interpret your results. 4 marks 5. Calculate each division's RI. Interpret your results and offer recommendations for any division with negative RI. 5 marks

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