8 ! Required information Part 1 of 2 [The following information applies to the questions displayed below.] Megamart, a retailer of consumer goods, provides the following information on two of its departments (each considered an investment center). Dints Investment Center Electronics Sporting goods Sales Income $40,250,000 $3,059,000 21,780,000 2,178,000 Average Invested sets $16,100,000 12,100,000 eBook Hint 1. Compute return on investment for each department. Using return on investment, which department is most efficient at using assets to generate returns for the company? 2. Assume a target income level of 10% of average invested assets. Compute residual income for each department. Which department generated the most residual income for the company? 3. Assume the Electronics department is presented with a new investment opportunity that will yield a 14% return on investment. Should the new investment opportunity be accepted? Print Required 1 Required 2 Required 3 Compute return on investment for each department. Using return on investment, which department is most efficient at using assets to generate returns for the company? Return on Investment Choose Numerator: | Choose Denominator: Return on Investment 1 11 Return on Investment = 11 Electronics / Sporting 1 Goods Which department is most efficient at using assets to generate returns for the company? Required 1 Required 2 Required 3 Assume a target income level of 10% of average invested assets. Compute residual income for each department. Which department generated the most residual income for the company? Investment Center Electronics Sporting Goods Net income Target net income Residual income Which department is most efficient at using assets to generate returns for the company? Required 1 Required 2 Required 3 Assume the Electronics department is presented with a new investment opportunity that will yield a 14% return on investment. Should the new investment opportunity be accepted? Should the new investment opportunity be accepted