Question - Margin, Turnover, Return on Investment, Average Operating Assets
Elway Company provided the following income statement for the last year:
Sales $1,040,000,000
Less: Variable expenses 700,250,000
Contribution margin $ 339,750,000
Less: Fixed expenses 183,750,000
Operating income $ 156,000,000
At the beginning of last year, Elway had $28,300,000 in operating assets. At the end of the year, Elway had $23,700,000 in operating assets.
Required:
1. Compute average operating assets.
2. Compute the margin (as a percent) and turnover ratios for last year.
3. Compute ROI as a percent.