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Fitness Fanatics is a regional chain of health clubs. The managers of the clubs, who have authori…

Nov 29, 2025 | Posted Assignments

Fitness Fanatics is a regional chain of health clubs. The
managers of the clubs, who have authority to make investments as
needed, are evaluated based largely on return on investment (ROI).
The company’s Springfield Club reported the following results for
the past year:


Sales	$	740,000
Net operating income	$	14,060
Average operating assets	$	100,000
Assume that the manager of the club is able to increase sales by $74,000 and that, as a result, net operating income increases by $5,476. Further assume that this is possible without any increase in operating assets. What would be the club’s return on investment (ROI)? Assume that the manager of the club is able to reduce expenses by $2,960 without any change in sales or operating assets. What would be the club’s return on investment (ROI)?