The Calculating Fashion Company Has Two Operating Divisions: North and South

Essay

The Calculating Fashion Company has two operating divisions: North and South. The following information was collected from its financial statements.
$$\begin{array} { l r r } & \text { North } & { \text { South } } \\\text { Operating income } & \$ 15,375 & \$ 9,160 \\\text { Sales } & 90,100 & 128,445 \\\text { Average operating assets } & 47,620 & 37,690\end{array}$$
Required:
The South Division has a goal to increase its ROI to 30% by the end of next year. Compute the increase (decrease) required in each of the following items in order to achieve this goal.
a. Operating assets
b. Total costs
c. Sales