125% T T Insert Zoom Table Chart Text Shape Media Comment Chapter: Performance measurement The owner of Bronx Bagels has recently expanded his business in order to add additional product lines. In addition to bagels, Bronx Bagels now sells muffins and sandwiches. The company has a minimum rate of return of 16%. Bagels $1,000,000 Muffins $75,000 Sandwiches $ 900,000 Sales Net operating income 350,000 15,750 270,000 Average operating assets 1,750,000 105,000 1,500,000 The owner of Bronx Bagels has recently expanded his business in order to add additional product lines. In addition to bagels, Bronx Bagels now sells muffins and sandwiches. The company has a minimum rate of return of 16%. Bagels $1,000,000 Muffins $75,000 Sandwiches $ 900,000 Sales I 350,000 15,750 270,000 Net operating income 1,750,000 Average operating assets 105,000 1,500,000 Instructions a. Compute the return on investment (ROI) for each investment center. operating income/average operating assets= 350,000/1750,000=20% b. Compute the residual income for each investment center. Net operating income-(average operating assets* minimum return)=350,000- (1750000*16%)= 250 000