Selected operating data for two divisions of Outback Brewing, Ltd., of Australia are given below (the currency is the Australian dollar, denoted here as $): Division
Queensland New South
Wales
Sales $4,000,000 $7,000,000
Average operating assets $2,000,000 $2,000,000
Net operating income $360,000 $420,000
Property, plant, and equipment (net) $950,000 $800,000
Requirement 1:
Compute the rate of return for each division using the return on investment (ROI) formula stated in terms of margin and turnover.
ROI
Queensland ?
New South Wales ?
Requirement 2:
Which divisional manager seems to be doing the better job?
