Division B had an ROI last year of 15%.The division's minimum required rate of return is 10%.If the division's average operating assets last year were $450,000,then the division's residual income for last year was:
A)$67,500
B)$22,500
C)$37,500
D)$45,000

Question

Quizplus · Accepted Answer

ROI = Net operating income F1F1F1S1F1F1F10 Average operating assets
Net operating income = ROI F1F1F1S1F1F1F10 Average operating assets = 15% F1F1F1S1F1F1F10 $450,000 = $67,500
 11eaa48f_7b34_87a6_9e4a_3d1a3e8ba79e_TB2485_00

Division B Had an ROI Last Year of 15