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CoursHeroTranscribedText: Required information Part 1 of 15 [The following information applies to the questions displayed below.] Westerville Company reported the following results from last year's operations: 10 points Sales $ 1, 500, 000 Variable expenses 650, 000 Contribution margin 850, 000 Fixed expenses 580, 000 Net operating income $ 270, 000 eBook Average operating assets $ 1, 000, 000 References At the beginning of this year, the company has a $160,000 investment opportunity with the following cost and revenue characteristics: Sales $ 240, 000 Contribution margin ratio 70 % of sales Fixed expenses $ 144, 000 The company's minimum required rate of return is 10%. Required: 1. What is last year's margin? Margin %2. What is last year's turnover? (Round your answer to 1 decimal place.) -: 3. What is last year's return on investment (ROI)? ROI %4. What is the margin related to this year's investment opportunity? Margin %5. What is the turnover related to this year's investment opportunity? (Round your answer to 1 decimal place.) :| 6. What is the ROI related to this year's investment opportunity? ROI %7. If the company pursues the investment opportunity and otherwise performs the same as last year, what margin will it earn this year? (Round your percentage answer to 1 decimal place (i.e .1234 should be entered as 12.3)) Margin %8. If the company pursues the investment opportunity and otherwise performs the same as last year, what turnover will it earn this year? (Round your answer to 2 decimal places.) :| 9. If the company pursues the investment opportunity and otherwise performs the same as last year, what ROI will it earn this year? (Round your percentage answer to 1 decimal place (i.e., 0.1234 should be considered as 12.3%. _- 10 Required information Part 10 of 15 [The following information applies to the questions displayed below] Westerville Company reported the following results from last year's operations: 10 Points Sales $ 1, 530,390 Variable expenses SSQIGW Contribution margin 856,366 Fixed expenses sandman Q Net operating income $ 270.0% EEDOk = Average operating assets $1.@@@.@@@ l [ References At the beginning ofthis year, the company has a $160,000 investment opportunity with the following cost and revenue characteristics: Sales 3; 246, one Contribution margin ratio 70% of sales Fixed expenses $ 144.13% ' The company's minimum required rate of return is 10%. 10-a. If Westerville's chief executive ofcer will earn a bonus only if her ROI from this year exceeds her ROI from last year, would she pursue the investment opportunity? Yes No 10b. Would the owners ofthe company want her to pursue the investment opportunity? Yes No 11. What is last year's residual income? Residual income12. What is the residual income of this year's investment opportunity? Residual income13. If the company pursues the investment opportunity and otherwise performs the same as last year, what residual income will it earn this year? : 14. If Westerville's chief executive officer will earn a bonus only if her residual income from this year exceeds her residual income from last year, would she pursue the investment opportunity? O Yes O No15-a. Assume that the contribution margin ratio of the investment opportunity was 65% instead of 70%. If Westerville's Chief Executive Ofcer will earn a bonus only if her residual income from this year exceeds her residual income from last year, would she pursue the investment opportunity? Yes No 15-h. Would the owners of the company want her to pursue the investment opportunity? Yes No

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