11.1.11 Return on investment (ROI) is computed in the following manner ROI is equal to turnover multiplied by earnings as a percent of sales Turnover is sales divided by total investment Total investment is current assets (inventories, accounts receivable. and cash) plus fixed assets Earnings equal sales minus the cost of sales The cost of sales consists of variable production costs, selling expenses, freight and delivery, and administrative costs. Complete parts a and b a. Construct an influence diagram that relates these variables. Choose the correct diagram below Cirak huTO to view initence diagram B) Click here to view influence diagram C Click here to view influence diagram D. Click here to view influence diagram A. b. Develop a mathematical model using the symbols defined on the left E Earnings ROI = T Turnover T = VE S. Sales TI= C. Cost of Sales TI Total Investment CA. Current Assets FA Fixed Assets PC Prod Costs SC Sales Expense FC Freight and Delivery AC Admin Costs

11.1.11 Return on investment (ROI) is computed in the following manner ROI is equal to turnover multiplied by earnings as a percent of sales Turnover is sales divided by total investment Total investment is current assets (inventories, accounts receivable. and cash) plus fixed assets Earnings equal sales minus the cost of sales The cost of sales consists of variable production costs, selling expenses, freight and delivery, and administrative costs. Complete parts a and b a. Construct an influence diagram that relates these variables. Choose the correct diagram below Cirak huTO to view initence diagram B) Click here to view influence diagram C Click here to view influence diagram D. Click here to view influence diagram A. b. Develop a mathematical model using the symbols defined on the left E Earnings ROI = T Turnover T = VE S. Sales TI= C. Cost of Sales TI Total Investment CA. Current Assets FA Fixed Assets PC Prod Costs SC Sales Expense FC Freight and Delivery AC Admin Costs

Financial And Managerial Accounting

15th Edition

ISBN:9781337902663

Author:WARREN, Carl S.

Publisher:WARREN, Carl S.

Chapter21: Variable Costing For Management analysis

Section: Chapter Questions

Problem 10E: How is the quantity factor for an increase or a decrease in the amount of sales computed in using...

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