Mallory, Inc The Tax Rate for Mallory, Inc

question 16

Essay

Mallory, Inc. has the following data available for two of its divisions for last year:
$$\begin{array} { l c r } && \text { Europearn } \\& \text { Asian Division } & \text {Division } \\ \text { Sales } & \$ 460,000 & \$ 900,000 \\\text { Contribution Margin } & 184,000 & 470,000 \\\text { Operating income } & 92,000 & 90,000 \\\text { Average operating assets } & 368,000 & 750,000 \\\text { Weighted average cost of capital } & 14 \% & 14 \%\end{array}$$
The tax rate for Mallory, Inc. is 18%.
Required:
(1) Compute the following for each division:
(a) Profit margin.
(b) Asset turnover.
(c) ROI.
(d) Residual income.
(e) EVA (assume there are no current liabilities).
(2) Briefly discuss which division appears most successful and why?

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Definitions:

Selective

Being highly specific or discriminating in choices or preferences, often referring to behaviors, actions, or processes in various contexts.

Continuous

Refers to something happening without interruption or end over a period of time.

Coconscious Subpersonalities

In dissociative identity disorder, these are the different identities or personalities that are aware of and can coexist with one another.

Host Personalities

In the context of Dissociative Identity Disorder, this term refers to the primary or dominant personality among multiple identities within an individual.