New-2161-Week-9-Homework-Template-1 - a b c d e Investment center Investment center Revenue center Profit center Cost center Margin = Operating Income

New-2161-Week-9-Homework-Template-1 - a b c d e Investment...

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Margin = Operating Income / Sales Turnover = Sales / Average Operating Assets Return on Investment (ROI) = Margin x Turnover Part 1 Year 1 Year 2 Operating Income *given Sales *given Margin (Operating Income / Sales) Sales *given Average Operating Assets *given Turnover (Sales / Average Operating Assets) Part 2 Return on Investment (ROI) [Margin x Turnover]
Residual Income = Operating income - (Minimum rate of return x Average operating assets) Part 1 Operating income Minimum rate of return Average operating assets Residual income Part 2 Was the ROI for the Tuxedo Division greater than, less than, or equal to 7 percent?
Part 1Who set the maximum transfer price?Who set the minimum transfer price?

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