how much is the residual income 649453
ROI, RESIDUAL INCOME
The following selected data pertain to the Silverthorne Division for last year:
|
Sales |
$1,000,000 |
|
Variable costs |
$600,000 |
|
Traceable fixed costs |
$100,000 |
|
Average invested capital |
$1,500,000 |
|
Imputed interest rate |
15% |
Required:
1. How much is the residual income?
2. How much is the return on investment?