129) Edith Carolina is president of the Deed Corporation. The company is decentralized, and leaves investment decisions up to the discretion of the division managers. Michael Sanders, manager of the Cosmetics Division, has had a return on investment of 14% for his division for the past three years and expects the division to have the same return in the coming year. Sanders has the opportunity to invest in a new line of cosmetics which is expected to have a return on investment of 12%. The company's minimum required rate of return is 8%. Suppose Deed Corporation evaluates managerial performance using return on investment. Edith Carolina, as president of the company, may view the opportunity for taking on the cosmetics line differently from Michael Sanders, manager of the Cosmetics Division. What action would each of them prefer with respect to the decision of whether to take on the new cosmetics line? 2309 Carolina accept Sanders reject reject accept accept accept reject reject A) Choice A B) Choice B C) Choice C D) Choice D 130) Edith Carolina is president of the Deed Corporation. The company is decentralized, and leaves investment decisions up to the discretion of the division managers. Michael Sanders, manager of the Cosmetics Division, has had a return on investment of 14% for his division for the past three years and expects the division to have the same return in the coming year. Sanders has the opportunity to invest in a new line of cosmetics which is expected to have a return on investment of 12%. The company's minimum required rate of return is 8%. If the Deed Corporation evaluates managerial performance using residual income based on the corporate minimum required rate of return of 8%, what decision would be preferred by Edith Carolins and Michael Sanders? Carolina Sanders accept reject reject accept accept accept reject reject A) Choice A B) Choice B C) Choice C D) Choice D 160) Gabbe Industries is a division of a major corporation. Last year the division had total sales of $8,910,000, net operating income of $962,280, and average operating assets of $3,000,000. The company's minimum required rate of return is 10%. Required: a. What is the division's margin? b. What is the division's turnover? 161) Haney Fabrication is a division of a major corporation. Last year the division had total net operating income of $1,897,280, and average operating assets of $7,000,000. The company's minimum required rate of return is 16%. Required: What is the division's return on investment (ROI)? 163) Eady Wares is a division of a major corporation. The following data are for the latest year of operations: Sales Net operating income Average operating assets The company's minimum required rate of return Required: What is the division's residual income? $ $ 19,600,000 470,400 $ 5,000,000 10%