ROI Using Operating Profit Margin and Asset Turnover
ROI Using Operating Profit Margin and Asset Turnover . Photo Products, Inc., has three divisions—Digital, Film, and Video. (This is the same company as the previous exercises. This exercise can be assigned independently.) Segmented income statement information for the most recent fiscal year ended December 31 is shown as follows. Assume average operating assets totaled $15,000,000 for the Digital division, $6,500,000 for the Film division, and $17,500,000 for the Video division.
Required:
a. For each division, calculate operating profit margin, asset turnover, and resulting ROI.
b. Which division has the highest ROI? For the division that has the lowest ROI, what can be done to improve this ratio?
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Posted 29 Jul 2017 08:07 AM
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