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What is the residual income for the year

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Reference no: EM13509153

Montana Company has reported the following results for last year's operations:

Sales

$50,000,000

Net operating income

6,000,000

Average operating assets

20,000,000

Required:

a) Compute Montana's margin, turnover, and ROI

b) Management has set a minimum required rate of return on average operating assets of 25%. What is the residual income for the year?

 

Reference no: EM13509153

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