How will increases in the following items affect residual income?
$\begin{array} { l c c } & \text { Increase in Sales } & \text { Increase in Equipment } \\end{array}$
A. $\begin{array} { l c c } & \text { Decrease RI } &&& \text { Decrease RI } \\end{array}$
B. $\begin{array} { l c c } & \text { Decrease RI } &&& \text { Increase RI } \\end{array}$
C. $\begin{array} { l c c } & \text { Increase RI } &&& \text { Decrease RI } \\end{array}$
D. $\begin{array} { l c c } & \text { Increase RI } &&& \text { Increase RI } \\end{array}$

A) Option A
B) Option B
C) Option C
D) Option D

Question

How will increases in the following items affect residual income?
 $\begin{array} {  l  c  c } & \text { Increase in Sales } & \text { Increase in Equipment } \\end{array}$
A. $\begin{array} {  l  c  c } & \text { Decrease RI } &&& \text { Decrease RI } \\end{array}$
B. $\begin{array} {  l  c  c } & \text { Decrease RI } &&& \text { Increase RI } \\end{array}$
C. $\begin{array} {  l  c  c } & \text { Increase RI } &&& \text { Decrease RI } \\end{array}$
D. $\begin{array} {  l  c  c } & \text { Increase RI } &&& \text { Increase RI } \\end{array}$

A) Option A
B) Option B
C) Option C
D) Option D

Quizplus · Accepted Answer

An increase in sales typically increases residual income (RI) as it boosts net income. An increase in equipment usually decreases RI due to higher capital charges.

How Will Increases in the Following Items Affect Residual Income Increase in Sales Increase in Equipment \begin{array} { l c c } & \text { Increase in Sales } & \text { Increase in Equipment } \\\end{array}​ Increase in Sales ​ Increase in Equipment ​

How Will Increases in the Following Items Affect Residual Income $\begin{array} { l c c } & \text { Increase in Sales } & \text { Increase in Equipment } \\\end{array}$