Return on investment (ROI) is profit divided by investment. In
marketing, ROI is determined as incremental...
Return on investment (ROI) is profit divided by investment. In
marketing, ROI is determined as incremental sales times gross
margin minus marketing investment, all divided by marketing
investment. Suppose that a company plans to spend $3 million to
place search engine ads and expects $15 million in incremental
sales. Its gross margin is estimated to be 45%.
Develop a spreadsheet to compute the marketing ROI.
Use the spreadsheet to predict how ROI will change if the
incremental sales estimate is...
Edith Blevins, the president of RAM Corp., requires a minimum
return on investment (ROI) of 10%...
Edith Blevins, the president of RAM Corp., requires a minimum
return on investment (ROI) of 10% on any new projects at her
company. Managers at RAM Corp. have the authority to make
investment decisions for their divisions. Malik Verdon, manager of
the Semiconductor Division, has had a ROI of 14% for his division
for the past two years and expects to earn a similar ROI this year.
Malik has the opportunity to invest in a new line of
semiconductors, which...
Calculate the return on investment (ROI) for the following five
projects, total cost includes the initial...
Calculate the return on investment (ROI) for the following five
projects, total cost includes the initial investment. Which
projects should be invested in if the organization has a spending
constraint of $7,000,000 and its cost of capital is 6%?
Total
Total
Project Investment
Revenue Cost
Profit ROI
A $3,000,000
$5,500,000 $5,000,000 _____
_____
B $2,400,000
$4,000,000 $3,800,000 _____
_____
C $1,350,000
$2,400,000 $2,300,000 _____
_____...
Determine the marketing return on sales (marketing ROS) and
return on marketing investment (marketing ROI) for...
Determine the marketing return on sales (marketing ROS) and
return on marketing investment (marketing ROI) for Company A and
Company B in the table below. Which company is performing
better?
Company A
Company B
Net Sales
$2,000,000
850,000
Cost of Goods Sold
$350,000
$325,000
Sales Expenses
$300,000
$150,000
1. Fill in the table below (round to the nearest whole
number). Calculate the net marketing contribution (NMC) for each
company.
Company A
Company B
NMC
$________
$_________
2. Calculate the marketing...
Determine the marketing return on sales (marketing ROS) and
return on marketing investment (marketing ROI) for...
Determine the marketing return on sales (marketing ROS) and
return on marketing investment (marketing ROI) for Company A and
Company B in the table below. Which company is
performingbetter?
Company A
Company B
Net Sales
$1,000,000
950,000
Cost of Goods Sold
$550,000
$425,000
Sales Expenses
$350,000
$150,000
1. Fill in the table below (round to the nearest whole
number). Calculate the net marketing contribution (NMC) for each
company.
Company A
Company B
NMC
$________
$_________
2. Calculate the marketing ROS...
Problem 11-15 Return on Investment (ROI) and Residual Income
[LO11-1, LO11-2]
Financial data for Joel de...
Problem 11-15 Return on Investment (ROI) and Residual Income
[LO11-1, LO11-2]
Financial data for Joel de Paris, Inc., for last year
follow:
Joel de Paris, Inc.
Balance Sheet
Beginning
Balance
Ending
Balance
Assets
Cash
$
126,000
$
133,000
Accounts receivable
334,000
489,000
Inventory
572,000
478,000
Plant and equipment, net
828,000
800,000
Investment in Buisson, S.A.
402,000
430,000
Land (undeveloped)
249,000
255,000
Total assets
$
2,511,000
$
2,585,000
Liabilities and Stockholders'
Equity
Accounts payable
$
374,000
$
346,000
Long-term debt
1,041,000...