Asked by Madison Bradford on May 22, 2024
Verified
Condren Inc.reported the following results from last year's operations: 
At the beginning of this year, the company has a $1,000,000 investment opportunity with the following characteristics: 
If the company pursues the investment opportunity and otherwise performs the same as last year, the combined ROI for the entire company will be closest to:
A) 1.1%
B) 8.6%
C) 9.7%
D) 11.3%
Combined ROI
A measure of the total return on investment from multiple investments or projects, combined into one metric.
Investment Opportunity
An item or asset obtained with the intention of producing income or increasing in value.
- Investigate the ROI for various business scenarios.
- Evaluate the combined effect of multiple investment opportunities on overall company performance.
Verified Answer
DO
doris okoawohMay 27, 2024
Final Answer :
C
Explanation : 
Net operating income = $600,000 + $77,000 = $677,000
Average operating assets = $6,000,000 + $1,000,000 = $7,000,000
ROI = Net operating income ÷ Average operating assets = $677,000 ÷ $7,000,000 = 9.7%
Net operating income = $600,000 + $77,000 = $677,000Average operating assets = $6,000,000 + $1,000,000 = $7,000,000
ROI = Net operating income ÷ Average operating assets = $677,000 ÷ $7,000,000 = 9.7%
Learning Objectives
- Investigate the ROI for various business scenarios.
- Evaluate the combined effect of multiple investment opportunities on overall company performance.