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# Company's return on investment

Cindy invested \$200,000 into a business that earned a profit of \$2,700 during the past month. Cindy believes the business will earn an annual profit equal to 12 times the monthly profit. Assume Cindy wants to take \$25,000 from the business each year for her personal use.

See table:
Resources created from sales: \$19,000
Resources consumed:

Materials: \$8,000
Insurance: \$2,000
Rent: \$1,500
Utilities: \$1,300
Wages: \$3,500
Total cost of resources consumed: \$16,300
Profit earned: \$2,700

a. Determine the company's return on investment.
b.Determine Cindy's return of investment.

#### Solution Preview

Cindy invested \$200,000 into a business that earned a profit of \$2,700 during the past month. Cindy believes the business will earn an annual profit equal to 12 times the monthly profit. Assume Cindy wants to take \$25,000 from the business each ...

#### Solution Summary

Response provides the steps to compute the company's return on investment

\$2.19