Stevens Company Has Two Divisions That Report on a Decentralized

Essay

Stevens Company has two divisions that report on a decentralized basis. Their results for 2004 were as follows:
Required:
Compute the following amounts for each division:

a.
Return on investment (ROI) if the desired rate of return is 12 percent.
b.
Residual income if the desired rate of return is 20 percent.
c.
EVA.
d.
Turnover if the desired rate of return is 25 percent.
e.
Margin for each division if the desired rate of return is 10 percent.