The Water Management Company Has Two Operating Divisions, the Service

question 80

Essay

The Water Management Company has two operating divisions, the Service Division and the Irrigation Division. The company evaluates the performance of its divisions using the return on investment (ROI) measure. The following information pertains to the two divisions as of the end of the current year.The average service fee was $50.00 per unit for the Service Division, while the average selling price of an irrigation system was $5,000 for the Irrigation Division. The company requires a minimum return on investment of 12%.Required:
Compute the return on investment (ROI) measure for both divisions and the company as a whole. Based on ROI alone which division had the better performance? (Round ROI measures to the nearest whole percent.)

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Definitions:

Communication Style

Refers to the ways in which individuals express themselves and interact with others, being influenced by cultural, societal, and personal preferences.

Weaknesses

Refers to the areas or aspects where an individual or entity may lack strength or proficiency.

Grapevine

An informal and unofficial communication channel within an organization, through which information, rumors, and gossip are typically spread.

Trust

A strong conviction in someone or something's reliability, truthfulness, capability, or robustness.