Texas Company Texas Company Has Established a Target Rate of Return of Return

question 166

Multiple Choice

Texas Company
Texas Company has established a target rate of return of 16% for all divisions.For the most recent year,San Marcos Division generated sales of $10,000,000 and expenses of $7,500,000.Total assets at the beginning of the year were $5,000,000 and total assets at the end of the year were $7,000,000.
Refer to Texas Company.For the most recent year,what was San Marcos Division's return on investment?

• A)20.83%
• B)35.71%
• C)41.67%
• D)50.00%

Evaluate the impact of changes in selling price on unit sales required to maintain net income.

Calculate and interpret contribution margin and understand its significance in CVP analysis.

Determine break-even sales and units to achieve desired profit levels.

Understand the differences between variable costing and absorption costing.

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