Return on Investment Choice of Location Compute the return on investment for each Fast & Great Burgers alternative. Return on Investment Numerator ROI Denominator ROI Location A Location B Return on Investment Choice of Location Return on Investment Choice of Location Using return on investment as your only criterion, which location (A or B) should the company open? Using return on investment as your only criterion, which location (A or B) should the company open? < Return on Investment Choice of Location
Return on Investment Choice of Location Compute the return on investment for each Fast & Great Burgers alternative. Return on Investment Numerator ROI Denominator ROI Location A Location B Return on Investment Choice of Location Return on Investment Choice of Location Using return on investment as your only criterion, which location (A or B) should the company open? Using return on investment as your only criterion, which location (A or B) should the company open? < Return on Investment Choice of Location
Chapter9: Responsibility Accounting And Decentralization
Section: Chapter Questions
Problem 19Q: Explain the benefits of a return on investment structure within an investment center framework. It...
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Question
You must prepare a return on investment analysis for the regional manager of Fast & Great Burgers. This growing chain is trying to decide which outlet of two alternatives to open. The first location (A) requires a $500,000 investment and is expected to yield annual net income of $70,000. The second location (B) requires a $200,000 investment and is expected to yield annual net income of $44,000.
Compute the return on investment for each Fast & Great Burgers alternative. Using return on investment as your only criterion, which location (A or B) should the company open? (The chain currently generates an 22% return on total assets.)
Transcribed Image Text:Return on
Investment
Choice of
Location
Compute the return on investment for each Fast & Great Burgers alternative.
Return on Investment
Numerator
ROI
Denominator
ROI
Location A
Location B
Return on Investment
Choice of Location
Transcribed Image Text:Return on
Investment
Choice of
Location
Using return on investment as your only criterion, which location (A or B) should the company open?
Using return on investment as your only criterion, which location (A or B) should the company open?
< Return on Investment
Choice of Location
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