### Computation of a residual income

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Computation of a residual income

A corporation has provided the following data-

 Return on investment (ROI) 15% Sales \$120,000 Average operating assets \$60,000 Minimum required rate of return 12% Margin on sales 7.5%

The corporation's residual income is-

a)     \$1,800

b)    \$5,400

c)     \$2,700

d)    \$3,600

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