1. The A Division of Sam Products Co. is considering an investment in a new project. The project has an estimated cost of P1,000,000. If Sam Products Co. has a target rate of return of 12%, how large does the return on investment on this project need to be to generate P170,000 of residual income? 2. Sam Division reported a residual income of P200,000 for the year just ended. The division has P8,000,000 of invested capital and P1,000,000 of income. On the basis of this information, the required rate of return was: (round off to 1 decimal places) 3. If the turnover increased by 40 percent and the margin decreased by 30 percent, the ROI would decreased by?

1. The A Division of Sam Products Co. is considering an investment in a new project. The project has an estimated cost of P1,000,000. If Sam Products Co. has a target rate of return of 12%, how large does the return on investment on this project need to be to generate P170,000 of residual income? 2. Sam Division reported a residual income of P200,000 for the year just ended. The division has P8,000,000 of invested capital and P1,000,000 of income. On the basis of this information, the required rate of return was: (round off to 1 decimal places) 3. If the turnover increased by 40 percent and the margin decreased by 30 percent, the ROI would decreased by?

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter12: Balanced Scorecard And Other Performance Measures

Section: Chapter Questions

Problem 4PB: Banyan Industries has two divisions, a tax rate of 30%, and a minimum rate of return of 20%....

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