Juniper design ltd. of manchester, england, is a company specializing in providing design services to residential developers. last year the company had net operating income of $460,000 on sales of $1,200,000. the company’s average operating assets for the year were $1,400,000 and its minimum required rate of return was 11%.

required:
compute the company’s residual income for the year.

average operating assets
net operating income
minimum required return
residual income

Asmall town wants to build some new recreational facilities. the proposed facilities include a swimming pool, recreation center, basketball court and baseball field. the town council wants to provide the facilities which will be used by the most people, but they face budget and land limitations. the town has $400,000 and 14 acres of land. the pool requires locker facilities which would be in the recreation center, so if the swimming pool is built the recreation center must also be built. also, the council has only enough flat land to build the basketball court or the baseball field. the daily usage and cost of the facilities (in $1,000) are shown below. which facilities should they build? facilityusagecost ($1,000)landswimming pool4001002recreation center5002003basketball court3001504baseball field2001005