Chicks Corporation had $1,100,000 in invested assets, sales of $1,210,000, income from operations amounting to $242,000, and a desired minimum rate of return of 15%.
The investment turnover for Chicks is:
A.1.3
B.1.2
C.1.0
D.1.1
1.2
To calculate the investment turnover for Chicks Corporation, we need to divide the sales by the average invested assets.
Average invested assets can be calculated by adding the beginning invested assets to the ending invested assets and dividing by 2.
Given that the invested assets are $1,100,000, we can assume that this is the beginning and ending invested assets.
Average invested assets = ($1,100,000 + $1,100,000) / 2 = $1,100,000
Now we can calculate the investment turnover:
Investment turnover = Sales / Average invested assets
Investment turnover = $1,210,000 / $1,100,000 = 1.1
Therefore, the investment turnover for Chicks Corporation is 1.1.
The answer is D. 1.1.
To calculate the investment turnover, you need to divide the sales by the average invested assets.
Average invested assets can be calculated by adding the beginning and ending invested assets and dividing them by 2.
Given:
Beginning invested assets = $1,100,000
Ending invested assets = $1,100,000
Average invested assets = (Beginning invested assets + Ending invested assets) / 2
= ($1,100,000 + $1,100,000) / 2
= $2,200,000 / 2
= $1,100,000
Now, we can calculate the investment turnover:
Investment turnover = Sales / Average invested assets
= $1,210,000 / $1,100,000
= 1.1
Therefore, the investment turnover for Chicks Corporation is 1.1.
So, the correct answer is D. 1.1.