The following information relates to the corner division of hometown enterprises: income for the period just ended: $1,500,000 invested capital: $12,000,000 if the company has an imputed interest rate of 11%, corner’s residual income would be:

Adrawback of short-term contracting as an alternative to making a component in-house is thata. it is the most-integrated alternative to performing an activity so the principal company has no control over the agent. b. the supplying firm has no incentive to make any transaction-specific investments to increase performance or quality. c. it fails to allow a long planning period that individual market transactions provide. d. the buying firm cannot demand lower prices due to the lack of a competitive bidding process.