alculating Residual Income

Forchen, Inc., provided the following information for two of its divisions for last year:

	Small Appliances Division	Cleaning Products Division
Sales	$34,620,000	$31,310,000
Operating income	2,766,500	1,253,800
Operating assets, January 1	6,400,000	5,680,000
Operating assets, December 31	7,540,000	6,210,000

Forchen, Inc., requires an 6 percent minimum rate of return.

Required:

1. Calculate residual income for the Small Appliances Division.

$

2. Calculate residual income for the Cleaning Products Division.

$