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Adrenaline Sports Company makes snowboards, downhill skis, cross-country skis, skateboards, surfboards, and in-line skates. The company has found it beneficial to split operations into two

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Adrenaline Sports Company makes snowboards, downhill skis, cross-country skis, skateboards, surfboards, and in-line skates. The company has found it beneficial to split operations into two divisions based on the climate required for the sport: Snow Sports and Non-Snow Sports. The following divisional information is available for the past year: (Click the icon to view the information.) Compute each division's residual income. Interpret your results. Are your results consistent with each division's ROI? First enter the formula, then calculate each divisions residual income. Operating income Total assets X Target rate of return ) = Residual income Snow X % Now calculate the Non-Snow Sports Division using the table below. Operating income ( Total assets X Target rate of return ). RI %) Are your results consistent with each division's ROI? Data Table Total Assets Current Liabilities ROI Sales Operating Income 5,500,000 $ 1,045,000 $ 8,400,000 $ 1,596,000 $ 4,000,000 $ 420,000 Snow Sports $ Non-Snow Sports $ 26.1% 6,000,000 $ 670,000 26.6% Adrenaline's management has specified a target 17% rate of return

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