The Pasta Division of Whole Grain Corporation Had Sales of $9,000,000

Multiple Choice

The Pasta Division of Whole Grain Corporation had sales of $9,000,000 and operating income of $1,620,000 last year. The total assets of the Pasta Division were $2,500,000, while current liabilities were $350,000. Whole Grain Corporation's target rate of return is 18%, while its weighted average cost of capital is 10%. The effective tax rate for the company is 45%. What is the Pasta Division's Return on Investment (ROI) ?

A) 18.00%
B) 3) 89%
C) 64.80%
D) 360.00%