Moto Corp allows its divisions to operate as autonomous units.The operating data for 2015 follow:
Required:
a.Compute the investment turnover for each division.
b.Compute the return on sales for each division.
c.Compute the return on investment for each division.
d.Which division manager is doing best? Why?
e.What other factors should be included when evaluating the managers?
For parts (b)and (c)income is defined as operating income.
Definitions:
Balance Sheet
A financial statement that shows the assets, liabilities, and equity of a company at a specific point in time, providing a snapshot of its financial condition.
Adjusted Trial Balance
A statement listing all accounts and their balances after adjustments have been made, serving as the basis for financial statements.
Net Income
Net income is the total profit of a business after all expenses, taxes, and deductions have been subtracted from total revenue.
Net Loss
Net loss is when a company's expenses exceed its revenues during a specific period, leading to a negative profit margin.
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