In calculating residual income, the variable set by top management is called the
A) average operating assets.
B) operating income.
C) hurdle rate.
D) actual operating assets.

Question

Quizplus · Accepted Answer

The variable set by top management in calculating residual income is the hurdle rate, which represents the minimum rate of return that a project or investment must earn to be considered acceptable.

In Calculating Residual Income, the Variable Set by Top Management