Cornwall Company Has Two Divisions, a and B What Is the Total Sales Amount for B?
A)$666,667
B)$800,000

question 17

Multiple Choice

Cornwall Company has two divisions, A and B. Information for each division is as follows: $\begin{array}{lrr}&A&B\\\text { Net earnings for division } & \$ 40,000 & \$ 260,000 \\\text { Asset base for division } & \$ 100,000 & \$ 1,200,000 \\\text { Target rate of return } & 15 \% & 18 \% \\\text { Margin } & 10 \% & 20 \% \\\text { Weighted average cost of capital } & 12 \% & 12 \%\end{array}$ What is the total sales amount for B?

• A)$666,667
• B)$800,000
• C)$1,300,000
• D)$1,200,000

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Definitions:

Bushels

A unit of volume that is commonly used in agriculture for measuring quantities of grain, fruit, and other agricultural produce, typically equal to about 35.24 liters in the U.S.

Harvest

The act or duration of harvesting crops.

Grain

A small, hard, dry seed used as food, harvested from cereals or legumes.

Rats

While often considered in scientific and medical research contexts, in economics, could metaphorically reference unanticipated variables or detrimental elements affecting market dynamics.