181. Using the data from the Koko Company,
(a)
determine the divisional income from operations for the three regions by allocating the service department expenses proportional to the sales of the regions.
(b)
determine the increase or decrease to net income if C Region did not operate.
A Region
B Region
C Region
Sales
$600,000
$900,000
$300,000
Cost of goods sold
200,000
350,000
190,000
Selling expenses
150,000
275,000
100,000
Service department expenses
Purchasing
120,000
Payroll accounting
80,000
182. Casey Co. has two divisions, F and G. Invested assets and condensed income statement data for each division for the past year ended December 31 are as follows:
Division F
Division G
Revenues
$175,000
$112,500
Operating expenses
112,500
92,750
Service department charges
27,500
12,625
Invested assets
225,000
97,500
(a)
Prepare condensed income statements for the past year for each division.
(b)
Using the expanded expression, determine the profit margin, investment turnover, and rate of return on investment for each division.
183. Data for Divisions R, S, T, U, and V are as follows:
Div.
Sales
Income fromOperations
Inv.Assets
Rate ofReturnon Inv.
ProfitMargin
Invest.Turnover
R
(1)
$35,000
$200,000
(2)
(3)
1.6
S
$455,000
(4)
$284,375
16%
(5)
(6)
T
$525,000
$73,500
(7)
(8)
(9)
1.2
U
$800,000
(10)
(11)
(12)
13.0%
2.5
V
(13)
(14)
$250,000
(15)
16.0%
2.0
(a)
Determine the missing items, identifying each by number.
(b)
Which division is most profitable in terms of income from operations?
(c)
Which division is most profitable in terms of rate of return on investment?
184. Several items are missing from the following table of rate of return on investment and residual income. Determine the missing items, identifying each item by the appropriate letter.
InvestedAssets
IncomefromOper.
Rate ofReturnon Inv.
Min.Rate ofReturn
Min. Amt.of IncomefromOper.
ResidualIncome
(a)
(b)
(c)
16%
$128,000
$10,000
$850,000
$153,000
(d)
12%
(e)
(f)
$825,000
(g)
20%
(h)
(i)
$24,000
(j)
$129,000
24%
(k)
$ 60,000
(l)
185. The sales, income from operations, and invested assets for each division of Jamieson Company are as follows:
Sales
Income fromOperations
InvestedAssets
Division E
$4,000,000
$550,000
$2,400,000
Division F
4,800,000
760,000
2,500,000
Division G
7,000,000
860,000
2,800,000
(a)
Using the expanded expression, determine the profit margin, investment turnover, and rate of return on investment for each division. Round to one decimal place.
(b)
Which is (are) the most profitable per dollar invested?
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