The Following Information Is Available About the Status and Operations

question 121

Essay

The following information is available about the status and operations for Division B of Boxwood Company, which has a minimum required ROI of 20%. Answer each item independently of the others.
$$\begin{array} { l r } & \text { Division B } \\\text { Divisional investment } & \$ 1,500,000 \\\text { Divisional profit } & \$ 550,000 \\\text { Divisional sales } & \$ 3,600,000\end{array}$$
Required:
a. Compute the ROI for Division B.
b. Division B could increase its profit by $25,000 by increasing its investment by $100,000. Compute its new ROI.
c. Division B could increase its profit margin ratio by one percentage point (for example: from 13% to 14%), without increasing total sales or investment. Compute its new ROI.
d. Division B could reduce its investment so that its asset turnover increased by one time, while holding total sales and profit constant. Compute its new ROI.

---

Definitions:

Myosin Heads

Part of the myosin molecule that binds to actin filaments and is crucial for muscle contraction.

F-actin

F-actin, or filamentous actin, is a polymerized form of actin filaments that is a key component of the cytoskeleton, involved in cell movement, stability, and division.

Skeletal Muscle

A type of muscle that is connected to bones and is responsible for voluntary movements of the body.

Sensory Neurons

Nerve cells that transmit sensory information (e.g., touch, sound, visual) from the body to the central nervous system for interpretation.