Question

return on investment the operating income and the amount of invested assets in each division of stewart industries are as follows: line item description operating income invested assets retail division $57,600 $320,000 commercial division 62,000 310,000 data analytics division 174,800 760,000 a. compute the return on investment for each division. (round to the nearest whole percentage.)

Answer 1

The Retail Division has an ROI of 18%, the Commercial Division has an ROI of 20%, and the Data Analytics Division has an ROI of 23%.

Step-by-step explanation:

The return on investment (ROI) for each division of Stewart Industries can be calculated using the formula ROI = (Operating Income / Invested Assets) * 100%. By applying this formula to the provided data for each division, we get:

• Retail Division: (57,600 / 320,000) * 100% = 18%
• Commercial Division: (62,000 / 310,000) * 100% = 20%
• Data Analytics Division: (174,800 / 760,000) * 100% = 23%

These percentages represent the return on investment as a whole number for each division, with Retail at 18%, Commercial at 20%, and Data Analytics at 23%.

To compute the return on investment for each division, divide the operating income by the invested assets and multiply by 100 to get a percentage. Here are the calculations:

Retail Division: Return on Investment = (Operating Income / Invested Assets) * 100 = ($57,600 / $320,000) * 100 = 18%

Commercial Division: Return on Investment = (Operating Income / Invested Assets) * 100 = ($62,000 / $310,000) * 100 = 20%

Data Analytics Division: Return on Investment = (Operating Income / Invested Assets) * 100 = ($174,800 / $760,000) * 100 = 23%