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    Return on investment (ROI)

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    Exercise 12-14 Effects of Changes in Sales, Expenses, and Assets on ROI [LO2]
    BusServ.com Corporation provides business-to-business services on the Internet. Data concerning the most recent year appear below:

    Sales $ 7,900,000
    Net operating income $ 780,000
    Average operating assets $ 2,500,000
    ________________________________________
    Consider each of the following requirements independently.

    Requirement 1:
    Compute the company's return on investment (ROI). (Round interim calculations and final answers to 2 decimal places. Omit the "%" sign in your response.)

    Return on investment (ROI) =
    %

    Requirement 2:
    The entrepreneur who founded the company is convinced that sales will increase next year by 130% and that net operating income will increase by 420%, with no increase in average operating assets. What would be the company's ROI?(Round interim calculations and final answers to 2 decimal places. Omit the "%" sign in your response.)

    Return on investment (ROI) =
    %

    Requirement 3:
    The Chief Financial Officer of the company believes a more realistic scenario would be a $2 million increase in sales, requiring an $780,000 increase in average operating assets, with a resulting $190,000 increase in net operating income. What would be the company's ROI in this scenario? (Round interim calculations and final answers to 2 decimal places. Omit the "%" sign in your response.)

    Return on investment (ROI)
    %

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    https://brainmass.com/business/financial-ratios/return-on-investment-roi-211139

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    Exercise 12-14 Effects of Changes in Sales, Expenses, and Assets on ROI [LO2]
    BusServ.com Corporation provides business-to-business services on the Internet. Data concerning the most recent year appear below:

    Sales $ 7,900,000
    Net operating income $ 780,000
    Average operating assets $ 2,500,000
    ________________________________________
    Consider each of the following requirements independently.

    Requirement 1:
    Compute the company's return on investment (ROI). (Round interim calculations and final answers to 2 ...

    Solution Summary

    This provides the steps to calculate the Return on investment (ROI)

    $2.19