Auto Parts is a division of MPI International, located in Wadena, Saskatchewan. Auto Parts manufactures various automobile parts, such as bumpers, fenders, and axles, and sells them to major auto manufacturers. The division and its management are evaluated by senior corporate management on the basis of investment centre concepts. The following information pertains to operations of the Auto Parts division for 2021: Operating results: Total revenues Less: Direct variable costs Contribution margin Less: Direct fixed costs Segment margin Less: Allocated corporate costs Operating income $ 20,150,000 8,295,000 11,855,000 7,245,000 4,610,000 3,802,000 $ 808,000 Market Values December 31, December 31, 2020 2021 Current assets Fixed assets Accumulated depreciation Total operating assets Liabilities Book Values December 31, December 31, 2020 2021 $ 1,204,000 $ 1,729,000 9,868,000 11,239,000 (1,204,000) (1,683,000) $ 9,868,000 $ 11,285,000 $ 2,887,000 $ 3,355,000 $ 6,981,000 $ 7,930,000 $ 9,171,000 $ 10,137,000 Net assets 3. Compute RI using operating income and the market value of average net assets. Assume that the required rate of return is 7%. Answer is complete but not entirely correct. Residual income $ 461,180