This Question 30 pts 33 of 39 10 complete This Test 300 pts

This Question: 30 pts 33 of 39 (10 complete) This Test: 300 pts possible Balspar Paints is a national paint manufacturer and retailer. The company is segmented into five divisions: Paint Stores (branded retail locations), Consumer (paint scld through home improvement stores), Automotive (sales to auto The following is selected divisional information for its two largest divisions: Paint Stores and Consumer EEB (Click the icon to view the information.) Management has specified a 19% target rate of return. Read the requirements Requ Requirements Begin by sel places, X.xx each Data Table Xr as a percent rounded to two decimal 1. Paint Stores Consumer Requ Begin by sel Calculate each divisicn\'s ROI Round all of your answers to four decimal places. Calculate each division\'s profit margin ratio. Interpret your results. Calculate each divisicn\'s asset turnover ratio. Interpret your results. Use the expanded ROl formula to confirm your results from Requirement 1 Interpret your results. Operating Average 2. 3. 4. Net Sales IncomeTotal Assets Paint Stores S 4,010,000 S472,000,380,000 1,600,000 division\'s 1,285,000 187,000 places, XXX%) 5. Calculate each division\'s RI. Interpret your results, and offer a recommendation for any division with negative R Describe some of the factors that management considers when setting its minimum target rate of return. 6. Paint Stores Print Done Consumer Print Done The Requirement 3. Calculate each division\'s asset tumover ratlo. Interpret your resuits

Solution

Solution 1: Return on Investment Particulars Choose Numerator / Choose denomerator = Return on Investment Details Amount Details Amount Paint Stores Operating Income $472,000.00 Total Assets $1,380,000.00 34.20% Consumer Operating Income $187,000.00 Total Assets $1,600,000.00 11.69% Solution 2: Sales Margin Particulars Choose Numerator / Choose denomerator = Profit Margin Details Amount Details Amount Paint Stores Operating Income $472,000.00 Sales $4,010,000.00 11.77% Consumer Operating Income $187,000.00 Sales $1,285,000.00 14.55% Solution 3: Capital Turnover Particulars Choose Numerator / Choose denomerator = Investment Turnover Details Amount Details Amount Paint Stores Sales $4,010,000.00 Total Assets $1,380,000.00                                      2.91 Consumer Sales $1,285,000.00 Total Assets $1,600,000.00                                      0.80 Solution 4: ROI using Expanded Formula Division Sales Margin * Capital Turnover = ROI Paint Stores 11.77% * 2.905797101 34.20% Consumer 14.55% * 0.803125 11.69%