The following data pertain to three divisions of Nevada Aggregates, Inc. The company’s required rate of return on invested capital is 8 percent. Division A Division B Division C Sales revenue $ ? $ 12,000,000 $ ? Income $ 590,000 $ 2,160,000 $ ? Average investment $ ? $ 2,610,000 $ ? Sales margin 30 % ? 35 % Capital turnover 2 ? ? ROI ? ? 30 % Residual income $ ? $ ? $ 131,000 Required: Suppose Division A’s sales margin increased to 35 percent, while its capital turnover remained constant. Compute the division’s new ROI. (Omit the "%" sign in your response.) New return on investment 70 correct %

The following data pertain to three divisions of Nevada Aggregates, Inc. The company’s required rate of return on invested capital is 8 percent.

	Division A			Division B			Division C
Sales revenue	$	?		$	12,000,000		$	?
Income	$	590,000		$	2,160,000		$	?
Average investment	$	?		$	2,610,000		$	?
Sales margin		30	%		?			35	%
Capital turnover		2			?			?
ROI		?			?			30	%
Residual income	$	?		$	?		$	131,000

Required:

Suppose Division A’s sales margin increased to 35 percent, while its capital turnover remained constant. Compute the division’s new ROI. (Omit the "%" sign in your response.)

New return on investment

70  %