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Assume All About Shoes Corporation has a division manager that is considering investing in the Hiking Shoes Project which had the following results last year
Assume All About Shoes Corporation has a division manager that is considering investing in the Hiking Shoes Project which had the following results last year (in thousands). Management's target rate of return is 20%. The division manager's current Rol before the investment is 30%. Sales Operating income Total assets Current liabilities $5,000,000 250,000 1,000,000 What is the the project's Residual Income (RI) and would the corporation's division manager accept or reject the project if the manager was evaluated using RI? O A. $50,000 and reject B. $250,000 and reject O C. $250,000 and accept O D. $50,000 and accept
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