Required:
The following data pertain to three divisions of Nevada Aggregates, Inc. The company's required rate of return on invested capital is 12
percent. (Round "Capital turnover" answers to 2 decimal place.)
Division A
Division B
Division C
Sales revenue
$ 7,500,000
$ 42,000,000
Income
$ 1,800,000
$ 8,400,000
Average investment
$ 7,500,000
$ 10,500,000
Sales margin
24%
20%
30%
Capital turnover
1.00
4.00
ROI
24 %
80%
24%
Residual income
$ 900,000
$ 7,140,000
$ 516,000