Westerville Company reported the following results from last year’s operations:
| Sales | $1,200,000 |
| Variable expenses | 320,000 |
| Contribution margin | 880,000 |
| Fixed expenses | 640,000 |
| Net operating income | $240,000 |
| Average operating assets | $600,000 |
At the beginning of this year, the company has a $150,000 investment opportunity with the following cost and revenue characteristics:
| Sales | $240,000 |
| Contribution margin ratio | 50 % of sales |
| Fixed expenses | $84,000 |
The company’s minimum required rate of return is 15%.
What was last year’s margin?
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