A national house building group has four divisions A, B, C and D. The divisions are currently assessed using a mixture of measures, including Return on Investment (ROI) and Residual Income (RI). Division D produced the following results in the last financial year: Net profit $400,000 Average net assets $2,000,000 For evaluation purposes all divisional assets are valued at original cost. The division is considering a project which will increase annual net profit by $30,000, but will require average inventory levels to increase by $100,000 and non-current assets to increase by $100,000. The company imposes a 16% capital charge on Division D. Will the evaluation criteria of Return on Investment (ROI) and Residual Income (RI) motivate Division D managers to accept the project?