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Question - Megamart, a retailer of consumer goods, provides the following information on two of its departments (each considered an investment center).

Investment Center

Sales

Net Income

Average Invested Assets

Electronics

$4,270,000

$660,000

$3,050,000

Sporting goods

6,240,000

920,000

4,800,000

Required -

Compute the profit margin for each department.

Compute the investment turnover for each department

Which department generates the most net income per dollars of sales?

Which department is most efficient at generating sales from average invested assets?

Accounting Basics, Accounting

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