6.

Residual income

The operating income and the amount of invested assets in each division of Stewart Industries are as follows:

	Operating Income	Invested Assets
Retail Division	$84,000	$400,000
Commercial Division	174,800	760,000
Data Analytics Division	64,600	380,000

Assume that management has established a 8% minimum acceptable return for invested assets.

a. Determine the residual income for each division.

Line Item Description	Retail Division	Commercial Division	Data Analytics Division
Operating income	$84,000	$174,800	$64,600
Minimum amount of operating income	fill in the blank 1	fill in the blank 2	fill in the blank 3
Residual income	$fill in the blank 4	$fill in the blank 5	$fill in the blank 6

b. Which division has the most residual income? ___________