1. Karl and Grady are managers of two product lines for Brewster Company. One of them is a candidate for promotion based on performance. Using the data he below, determine who had the better performance using performance measures including as net income, profit margin and return on investment. Show your calculations and support your answer.

	Karl	Grady
Revenue	$412.000	$450,000
Costs	380.000	411,000
Average Assets	400,000	600,000

2. Use the Hamilton Company's investment center information below to calculate (a) return on total investment and (b) investment center residual income.

Net Income ………………… $315,900

Average Invested Assets …… $2,100,000

Target Net Income………….. 6% of division assets