Asked by Isaiah Tijero on May 08, 2024
Verified
The turnover for Year 1 was:
A) 1.2
B) 1.5
C) 3.0
D) 4.0
Turnover
The rate at which inventory or assets of a business are replaced or sold within a given period.
Year 1
The initial year of a time series or the first year of operation.
- Examine and judge the profitability and efficiency of investments by looking at margins and turnovers.
Verified Answer
RB
Regine BarcelonMay 14, 2024
Final Answer :
B
Explanation :
Year 2 ROI = Year 2 Margin × Year 2 Turnover
36% = Year 2 Margin × 3
Year 2 Margin = 36% ÷ 3 = 12%
Year 2 Margin = 150% × Year 1 Margin
12% = 150% × Year 1 Margin
Year 1 Margin = 12% ÷ 150% = 8%
Year 1 ROI = Year 1 Margin × Year 1 Turnover
12% = 8% × Year 1 Turnover
Year 1 Turnover = 12% ÷ 8% = 1.5
36% = Year 2 Margin × 3
Year 2 Margin = 36% ÷ 3 = 12%
Year 2 Margin = 150% × Year 1 Margin
12% = 150% × Year 1 Margin
Year 1 Margin = 12% ÷ 150% = 8%
Year 1 ROI = Year 1 Margin × Year 1 Turnover
12% = 8% × Year 1 Turnover
Year 1 Turnover = 12% ÷ 8% = 1.5
Learning Objectives
- Examine and judge the profitability and efficiency of investments by looking at margins and turnovers.