Terra Company Has Two Divisions,the Retail Division and the Wholesale

question 113

Multiple Choice

Terra Company has two divisions,the Retail Division and the Wholesale Division.The following information was gathered for the two divisions for the current year: $\begin{array}{|l|lr|lr|}\hline & {\text { Retail Division }} & &{\text { Wholesale Division }} \\\hline \text { Operating income } & \$ & 2,500,000 & \$ & 6,000,000 \\\hline \text { Operating assets } & \$ & 16,000,000 & \$ & 36,000,000 \\\hline\end{array}$ Terra Company has set a target return on investment (ROI) of 15% for both divisions.Based on ROI,which division appears to have performed better?

• A) Retail division.
• B) Wholesale division.
• C) Both divisions have the same results.
• D) The answer cannot be determined using the information provided.

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Definitions:

Trade Regulation Rules

Rules established by regulatory authorities to govern the practices of businesses, aimed at ensuring fairness in commerce and preventing anticompetitive behavior.

Consent Order

A legal agreement approved by a court, usually resolving a dispute between parties without admission of guilt or liability.

Cease-And-Desist Order

A legal order issued by a governmental agency or court to halt a particular activity or practice deemed illegal or harmful.

Deceptive Omissions

Misleading practices involving the withholding of important information or details that could influence a consumer's purchasing decision.