Business, 10.12.2021 23:50 samara49

Presented below is selected information for three regional divisions of Medina Company. Divisions
North South West
Contribution margins $300,000 $500,000 $400,000
Controllable margin $140,000 $360,000 $210,000
Average operating assets $1,000,000 $2,000,000 $1,500,000
Minimum rate of return 13% 16% 10%
A) Compute the return on investment for each division
B) Compute the residual income for each division
C) Assume that each division has an investment opportunity that would provide a rate of return of 16%
1. If ROI is used to measure performance, which division or divisions will probably make the additional investment?
2. If residual income is used to measure performances, which division or divisions will probably make the additional investment?

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Presented below is selected information for three regional divisions of Medina Company. Divisions<...

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