Compute residual income for each division

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Reference no: EM13948347

Consider the following data for two divisions of the same company:

 
North Woods
Midwest

Sales

$3,000,000

$10,000,000

Average operating assets

1,000,000

3,000,000

Operating income

140,000

330,000

Minimum required return

8%

8%

Required

1. Compute residual income for each division.

2. Compute ROI for each division.

Reference no: EM13948347

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