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1. Compute return on investment (ROI). 2. Compute residual income. 1 Return on Investment (ROI) and Residual Income - Excel PAGE LAYOUT FORMULAS DATA REVIEW VIEW FILE HOME INSERT Sign In X Calibri - 111 A A 96 Alignment Number Conditional Format as Cell Formatting Table Styles Paste BIU- Cells Editing Clipboard Font Styles for Adams Corporation evaluates divisional managers based on ROI. Operating B C D E F . Adams Corporatior evaluates divisional managers based on ROL Operating results for the company's Northern Division for last year are given below: 2 3 4 $ 5 6 7 Sales Variable expenses Contribution margin Fixed expenses Net operating income 27,000,000 16,200,000 10,800,000 8,805,000 1.995,000 8 S 9 10 Average divisional operating assets S 9,500,000 11 12 The Northern Division has an opportunity to add a new product line at the beginning of the year as follows: 13 14 15 16 $ Average required investment Net operating income 2,500,000 400,000 14 15 Average required investment Net operating income 2,500,000 400.000 16 17 Adams Corporation's minimum acceptable rate of return 15% 18 19 Assuming the company accepts all projects that meet or exceed the minimum rate of return, compute the following: 20 21 Northern Division ROI for last year 22 23 Northern Division ROI if new product line is added 24 27 25 Write an IF statement to determine whether the Northern Division 26 manager will ACCEPT or REJECT the new product line based on ROI. 28 Northern Division residual income for last year 30 Northern Division residual income if the new product line is added 32 Write an IF statement to determine whether the Northern Division manager 33 will ACCEPT or REJECT the new product line based on residual income 29 31 34 35 36