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Home Q & A Board Other Fields Homework Help Business Accounting
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jerico jerico
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9 years ago
Gas Supply Corporation uses the investment center concept for the gasoline stations that it manages in the city. Consolidated has a 15% required rate of return on investment in order for a branch station to be viable. Select operating data for three of its stations for 2015 are as follows:

   Maple Street   Oak Street   High Street
Revenue   $17,000,000   $13,500,000   $15,000,000
Operating assets   7,000,000   7,000,000   6,000,000
Net operating income   900,000   1,200,000   980,000

Required:
a.   Compute the return on investment for each station.
b.   Which station manager is doing best based only on ROI? Why?
c.   Are any of the stations in danger of being closed due to lack of performance?
d.   What other factors should be included when evaluating the managers?
Textbook 
Cost Accounting

Cost Accounting


Edition: 14th
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cyborgcyborg
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9 years ago
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jerico Author
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#2
9 years ago
Very happy to know people like you still exist. Really, without your help, I wouldn't understand the content one bit.
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#3
9 years ago
Sweet, you're welcome.
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