Chicks Corporation Had $1,100,000 in Invested Assets, Sales of $1,210,000

question 121

Multiple Choice

Chicks Corporation had $1,100,000 in invested assets, sales of $1,210,000, operating income amounting to $302,500, and a desired minimum return on investment of 15%.​
-The investment turnover for Chicks Corporation is

• A)1.3
• B)1.5
• C)1.0
• D)1.1

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Definitions:

Operating Leverage

Operating leverage describes the degree to which a company can increase its profits by increasing sales, reflecting the proportion of fixed costs to variable costs.

Sales Decrease

A reduction in the volume or value of sales within a company during a specific period compared to a previous period.

Profits Decrease

A reduction in the financial gains achieved by a business or investment over a specific period.

Unemployment

The condition of being jobless among individuals who are actively seeking work.