Responsibility Accounting and Performance Measures Paper 14

1

The following is selected data for the Consumer Products division of Arron Corporations for 200X:
Sales $50,000,000
Average invested capital (assets) 20,000,000
Net income 2,000,000
Cost of capital 8%
What is the return on sales (ROS) for the division?






2

The following is selected data for the Consumer Products division of Arron Corporations for 200X:
Sales $50,000,000
Average invested capital (assets) 20,000,000
Net income 2,000,000
Cost of capital 8%
What is the asset turnover ratio for the division?






3

The following is selected data for the Consumer Products division of Arron Corporations for 200X:
Sales $50,000,000
Average invested capital (assets) 20,000,000
Net income 2,000,000
Cost of capital 8%
What is the return on investment (ROI) for the division?






4

The following is selected data for the Consumer Products division of Arron Corporations for 200X:
Sales $50,000,000
Average invested capital (assets) 20,000,000
Net income 2,000,000
Cost of capital 8%
What is the amount of residual income (RI) for the division?






5

The following is selected data for the Consumer Products division of Arron Corporations for 200X:
Sales $50,000,000
Average invested capital (assets) 20,000,000
Net income 2,000,000
Cost of capital 8%
What is the amount of interest rate spread for the division?






6

The following is available for Cara Corp. for 2012:
Sales $2,000,000
Average invested capital 500,000
Net income 300,000
Required rate of return 18%
What is the return on investment at Cara Corp.?






7

The following is available for Cara Corp. for 2012:
Sales $2,000,000
Average invested capital 500,000
Net income 300,000
Required rate of return 18%
What is the residual income for Cara Corp.?






8

A company’s rate of return on investment (ROI) is equal to the






9

Return on investment can be increased by






10

Select Co. had the following 2012 financial statement relationships:
Asset turnover 5
Profit margin on sales 0.02
What was Select’s 2012 percentage return on assets?






Result

Total Questions:
Correct Answers:
Wrong Answers:
Percentage: