Midtown Division, Which Is Part of Courtyard Enterprises, Recently Reported

question 65

Essay

Midtown Division, which is part of Courtyard Enterprises, recently reported a sales margin of 30% and an ROI of 21%.
Required:
A. Briefly define sales margin, capital turnover, and return on investment.
B. Assume that Midtown has residual income of $220,000 and that Courtyard uses an imputed interest rate of 10%. Compute Midtown's capital turnover and invested capital.
C. In answering this question, ignore the assumptions stated in in requirement "B," and your answer. Instead, assume that Midtown's invested capital amounted to $2,500,000. On the basis of this information, calculate income and sales revenue.

---

Definitions:

Sensory Skills

The abilities related to the detection, identification, and interpretation of sensory information from the environment.

Cooking Food

The process of preparing food by combining, mixing, and heating ingredients, which can increase digestibility and reduce foodborne pathogens.

Caloric Gain

The increase in calories obtained and absorbed from food and beverages, contributing to energy resources or weight gain.

Foraging

The act of searching for and exploiting food resources by animals, including humans.