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The United World Corporation has three subsidiaries.

Computers Magazines CableTV

Sales $16,000,000 $4,000,000 $8,000,000

Net income(after taxes) $1,000,000 $160,000 $600,000

Assets $5,000,000 $2,000,000 $5,000,000

A) Which division has the lowest return on sales?

B) Which division has the highest return on assets?

C) Compute the return on assets for the entirecorporation.

D) If the $5,000,000 investment in the cable TV division issold off and redeployed in the computer division at the same rate of return on assets currently achieved in the computer division,what will be the new return on assets for the entire corporation?

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Accounting Basics, Accounting

Category:- Accounting Basics
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