Reimer Division's Operating Results Include Controllable Margin, $150,000 Sales Revenue, $1,200,000
Essay
Reimer Division's operating results include:
Controllable margin, $150,000
Sales revenue, $1,200,000
Operating assets, $500,000
Reimer is considering a project with sales of $120,000, expenses of $84,000, and an investment of $180,000. Reimer's required rate of return is 15%.
Instructions
Determine whether Reimer should accept this project.
Correct Answer:

Verified
Current ROI = $150,000 ÷ $500,000 = 30%
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