What would be the company roi in this scenario

Assignment Help Accounting Basics
Reference no: EM132106092

Question - Effects of Changes in Sales, Expenses, and Assets on ROI

BusServ Corporation provides business-to-business services on the Internet. Data concerning the most recent year appear below:

Sales $8,000,000

Net operating income $800,000

Average operating assets $3,200,000

Required: Consider each question below independently. Carry out all computations to two decimal places.

1. Compute the company's return on investment (ROI).

2. The entrepreneur who founded the company is convinced that sales will increase next year by 150% and that net operating income will increase by 400%, with no increase in average operating assets. What would the company's ROI?

3. The Chief Financial Officer of the company believes a more realistic scenario would be a $2 million increase in sales, requiring an $800,000 increase in average operating assets, with a resulting $250,000 increase in net operating income. What would be the company's ROI in this scenario?

Reference no: EM132106092

Questions Cloud

People living with schizophreniar : What advocacy groups are offering support/help for people living with schizophreniar? What sort of current legislation, if any, is impacting people living with
Explain the purposes of the uniform crime reports : Explain the purposes of the Uniform Crime Reports (UCR) and the National Crime Information Center (NCIC).
How much energy is required to ionize hydrogen : How much energy is required to ionize hydrogen when it is inthe ground state? How much energy is required to ionize hydrogen when it is inthe state.
What factors influence statistical power : Please elaborate on the power issues may arise. What factors influence statistical power? What biases may occur in this study?
What would be the company roi in this scenario : Question - Effects of Changes in Sales, Expenses, and Assets on ROI - What would be the company's ROI in this scenario
Which jail program do you believe is most beneficial : The varied types of programs offered in correctional facilities: educational, medical, mental health, substance abuse, life skills, religious, job training.
How much charge is enclosed within the octahedron : The net electric flux through an octahedron is -1000N m^2/C. How much charge is enclosed within the octahedron? The response must be typed.
Differentiate the crime of assault and the crime of battery : Compare and contrast the key similarities and differences between the crime of assault and the crime of battery.
Advantages and disadvantages of workers in the public sector : What are the advantages and disadvantages of workers in the public sector belonging to labor unions?

Reviews

Write a Review

 

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd