What is the division's Return on Investment (ROI) if sales are $700,000, operating income is $175,000, and total assets are $1,500,000?

To determine the Return on Investment (ROI) for the division, the formula used is:

[ \text{ROI} = \left( \frac{\text{Operating Income}}{\text{Total Assets}} \right) \times 100 ]

In this case:

• Operating Income = $175,000
• Total Assets = $1,500,000

Plugging in the values:

[ \text{ROI} = \left( \frac{175,000}{1,500,000} \right) \times 100 ]

Calculating the fraction:

[ \frac{175,000}{1,500,000} = 0.11667 ]

When converted to a percentage by multiplying by 100:

[ 0.11667 \times 100 = 11.67% ]

Thus, the division's ROI is 11.67%, which aligns with the chosen answer. This percentage reflects how effectively the division is using its assets to generate income. A higher ROI indicates more efficient use of assets in generating profit.