If an Investment Center Has a $45,000 Controllable Margin and $600,000

question 56

Multiple Choice

If an investment center has a $45,000 controllable margin and $600,000 of sales, what average operating assets are needed to have a return on investment of 10%?

• A) $60,000
• B) $105,000
• C) $450,000
• D) $600,000

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Definitions:

Utilities Expense

Costs incurred by a business for basic utilities such as water, electricity, gas, and sewage services.

Services Provided

Services provided refer to the performance of non-tangible tasks or activities by a company for its clients or customers, as opposed to selling physical products.

Customer on Account

A term used to describe a sale made on credit, where the customer agrees to pay the amount owed at a later date.

Journal Entries

Records of financial transactions in the accounting system of a business, indicating the accounts and amounts to be debited and credited.