The Current Controllable Margin for Henry Division Is $93000

question 103

Multiple Choice

The current controllable margin for Henry Division is $93000. Its current operating assets are $300000. The division is considering purchasing equipment for $90000 that will increase annual controllable margin by an estimated $15000. If the equipment is purchased what will happen to the return on investment for Henry Division?

• A) An increase of 16.1%
• B) A decrease of 13.3%
• C) A decrease of 3.3%
• D) A decrease of 7.2%

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Definitions:

Accommodate

To make fit, suitable, or congruous; to provide with something desired, needed, or suited.

Lockout

A tactic used by employers to pressurize workers during labor disputes by temporarily closing the business and denying the workers entry.

Security Guards

Individuals employed to protect property, assets, or people, often employed by private companies, government institutions, or individuals.

Bargain Hard

The practice of negotiating forcefully or assertively to achieve favorable terms.