Coolbrook Company has the following information available for the past year: Sales revenue Cost of goods sold and operat

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Coolbrook Company Has The Following Information Available For The Past Year Sales Revenue Cost Of Goods Sold And Operat 1 (42.8 KiB) Viewed 62 times

Coolbrook Company has the following information available for the past year: Sales revenue Cost of goods sold and operating expenses Net operating income Average invested assets River Division $ 1,216,000 893,000 $ 323,000 $ 1,180,000 Stream Division $ 1,818,000 1,298,000 $ 520,000 $ 1,460,000 The company's hurdle rate is 6.26 percent. Required: 1. Calculate return on investment (ROI) and residual income for each division for last year. 2. Recalculate ROI and residual income for the division for each independent situation that follows: a. Operating income increases by 11 percent. b. Operating income decreases by 8 percent. c. The company invests $254,000 in each division, an amount that generates $119,000 additional income per division. d. Coolbrook changes its hurdle rate to 4.26 percent. Complete this question by entering your answers in the tabs below. Req 1 Req 2A Req 2B Req 2c Req 2D
Calculate return on investment (ROI) and residual income for each division for last year. (Enter your ROI answers as a percentage rounded to two decimal places, (i.e., 0.1234 should be entered as 12.34%.)) River Division Stream Division ROI % % Residual Income (Loss)
Recalculate ROI and residual income for each division for the independent situation that follows: Operating income increases by 11 percent. (Enter your ROI answers as a percentage rounded to two decimal places, (i.e., 0.1234 should be entered as 12.34%.). Loss amounts should be indicated with a minus sign.) River Division Stream Division % % ROI Residual Income (Loss)
Recalculate ROI and residual income for each division for the independent situation that follows: Operating income decreases by 8 percent. (Enter your ROI answers as a percentage rounded to two decimal places, (i.e., 0.1234 should be entered as 12.34%.). Loss amounts should be indicated with a minus sign.) River Division Stream Division % % ROI Residual Income (Loss)
Recalculate ROI and residual income for each division for the independent situation that follows: Coolbrook changes its hurdle rate to 4.26 percent. (Enter your ROI answers as a percentage rounded to two decimal places, (i.e., 0.1234 should be entered as 12.34%.). Loss amounts should be indicated with a minus sign.) River Division Stream Division ROI % % Residual Income (Loss)