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28 January, 22:41

Liz Raiborn Inc. has the following financial results for the years 2019 through 2021 for its three regional divisions: 2019 2020 2021 Revenue Southwest $ 14,675 $ 21,775 $ 25,775 Midwest 6,475 6,775 6,975 Southeast 12,175 12,775 13,075 Total $ 33,325 $ 41,325 $ 45,825 Net Operating Income Southwest $ 875 $ 975 $ 1,125 Midwest 1,025 1,375 1,325 Southeast 775 975 1,375 Total $ 2,675 $ 3,325 $ 3,825 Average Total Assets Southwest $ 13,775 $ 13,975 $ 16,575 Midwest 4,475 3,975 3,975 Southeast 5,075 5,375 5,375 Total $ 23,325 $ 23,325 $ 25,925

Calculate Return on Sales (ROS), asset turnover (AT), and return on investment (ROI) for each division and also for the firm as a whole for each of the three years 2019, 2020, and 2021.

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  1. 28 January, 23:49
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    return on sales = operating profit / net sales

    Southwest 2019 = $875 / $14,675 = 5.96%

    Southwest 2020 = $975 / $21,775 = 4.48%

    Southwest 2021 = $1,125 / $25,775 = 4.36%

    Midwest 2019 = $1,025 / $6,475 = 15.83%

    Midwest 2020 = $1,375 / $6,775 = 20.3%

    Midwest 2021 = $1,325 / $6,975 = 19%

    Southeast 2019 = $775 / $12,175 = 6.37%

    Southeast 2020 = $975 / $12,775 = 7.63%

    Southeast 2021 = $1,375 / $13,075 = 10.52%

    asset turnover = net sales / average total assets

    Southwest 2019 = $14,675 / $13,775 = 1.07

    Southwest 2020 = $21,775 / $13,975 = 1.56

    Southwest 2021 = $25,775 / $16,575 = 1.56

    Midwest 2019 = $6,475 / $4,475 = 1.45

    Midwest 2020 = $6,775 / $3,975 = 1.7

    Midwest 2021 = $6,975 / $3,975 = 1.75

    Southeast 2019 = $12,175 / $5,075 = 2.4

    Southeast 2020 = $12,775 / $5,375 = 2.38

    Southeast 2021 = $13,075 / $5,375 = 2.43

    return on investment = net income / cost of investment

    Southwest 2019 = $875 / $13,775 = 6.35%

    Southwest 2020 = $975 / $13,975 = 6.98%

    Southwest 2021 = $1,125 / $16,575 = 6.79%

    Midwest 2019 = $1,025 / $4,475 = 22.9%

    Midwest 2020 = $1,375 / $3,975 = 34.59%

    Midwest 2021 = $1,325 / $3,975 = 33.33%

    Southeast 2019 = $775 / $5,075 = 15.27%

    Southeast 2020 = $975 / $5,375 = 18.14%

    Southeast 2021 = $1,375 / $5,375 = 25.58%

    Explanation:

    Revenue 2019 2020 2021

    Southwest $ 14,675 $ 21,775 $ 25,775

    Midwest 6,475 6,775 6,975

    Southeast 12,175 12,775 13,075

    Total $ 33,325 $ 41,325 $ 45,825

    Net Operating Income 2019 2020 2021

    Southwest $ 875 $ 975 $ 1,125

    Midwest 1,025 1,375 1,325

    Southeast 775 975 1,375

    Total $ 2,675 $ 3,325 $ 3,825

    Average Total Assets 2019 2020 2021

    Southwest $ 13,775 $ 13,975 $ 16,575

    Midwest 4,475 3,975 3,975

    Southeast 5,075 5,375 5,375

    Total $ 23,325 $ 23,325 $ 25,925
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