Sales revenues, Fibers $ 870,000
Sales revenues, Feedstocks $ 820,000 Variable expenses, Fibers $ 426,000 Variable expenses, Feedstocks $ 344,000
Traceable fixed expenses, Fibers $ 148,000 Traceable fixed expenses, Feedstocks S156,000
Common fixed expenses totaled $ 314,000 and were allocated as follows: $ 129,000 to the Fibers business segment and $ 185,000 to the Feedstocks business segment.
Required:
Prepare a segmented income statement in the contribution format for the company. Omit percentages; show only dollar amounts.
2. Question:
( TCO D) Wryski Corporation had net operating income of $ 150,000 and average operating assets of $ 500,000. The company requires a return on investment of 19 %.
Required:
i. Calculate the company ' s current return on investment and residual income.
ii. The company is investigating an investment of $ 400,000 in a project that will generate annual net operating income of $ 78,000. What is the ROI of the project? What is the residual income of the project? Should the company invest in this project?