QS 24-11 Computing residual income LO A1
| Investment
Center |
Net Income |
|
Average Assets |
| Cameras and
camcorders |
$ |
6,150,000 |
|
|
$ |
26,900,000 |
| Phones and communications |
|
2,170,000 |
|
|
|
15,500,000 |
| Computers and accessories |
|
1,050,000 |
|
|
|
17,400,000 |
|
Assume a target income of 14% of average invested assets.
Required:
Compute residual income for each division. (Enter losses
with a minus sign.)
|
|
| Target
Income |
Cameras and Camcorders |
Phones and Communications |
Computers and Accessories |
|
|
|
|
|
| Targeted
return |
|
|
|
| Target
income |
|
|
|
| Residual
Income |
Cameras and Camcorders |
Phones and Communications |
Computers and Accessories |
|
|
|
|
|
|
|
|
|
|
| Residual income (loss) |
|
|
|
|