Borraw Company
the Following Information Pertains to the Three Divisions

question 81

Multiple Choice

Borraw Company
The following information pertains to the three divisions of Borraw Company: $\begin{array}{lll}&\text { Division } A & \text { Division } B\\\text { Sales } & ? & 1,250,000 \\\text { Net operating income } & \$ 25,000 & \$ 75,000 \\\text { Average operating assets } & ? & ? \\\text { Rebum on investment } & 20 \% & 15 \% \\\text { Margin } & 0.05 & ? \\\text { Tumover } & ? & ? \\\text { Target ROI } & 12 \% & 10 \%\end{array}$
-Refer to Borraw Company. What is the turnover for Division B?

• A) 0.150
• B) 1.500
• C) 2.500
• D) 6.670

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Definitions:

Tax Advantage

A tax advantage refers to the economic bonus that applies to certain accounts or investments that are exempt from taxation, or taxed at a lower rate.

Rising Prices

A situation where the general level of prices for goods and services increases over a period, indicative of inflation.

LIFO Liquidation

The process of reducing inventory using the Last-In, First-Out (LIFO) method, which can impact the cost of goods sold and taxes during times of inflation.

SEC

The Securities and Exchange Commission is an agency of the U.S. government tasked with enforcing federal laws pertaining to securities and overseeing the securities industry, including stock and options exchanges.