Return on investment and residual income the following information pertains to VI Divison, which has $1,400.000 in

Question:

Return on investment and residual income the following information pertains to VI Divison, which has $1,400.000 in investments.
Division sales revenue.........................$900,000
Less division expenses...........................48,000
Division income................................$420,000
The company is10%
Required
(a) What is the division's return on investment?
(b) What is the division's residual income?
Cost Of Capital
Cost of capital refers to the opportunity cost of making a specific investment . Cost of capital (COC) is the rate of return that a firm must earn on its project investments to maintain its market value and attract funds. COC is the required rate of...