At the start of the year, a division has non-current assets of $4 million and makes no add

itions or disposals during the year. Depreciation is charged at a rate of 10% per annum on all non-current assets held at the end of the year. Working capital is $0·5 million at the start of the year although this is expected to increase by 20% by the end of the year. The budgeted profit of the division after depreciation is $1·2m.

What is the expected ROI of the division for the year, based on average capital employed？

A.27·59%

B.26·37%

C.18·39%

D.31·58%