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Avocado Company has net operating income of $80,000 on sale revenue of $1,000,000. Average invested assets are $500,000, and Avocado Company has an 8% hurdle

Avocado Company has net operating income of $80,000 on sale revenue of $1,000,000. Average invested assets are $500,000, and Avocado Company has an 8% hurdle rate. What is the residual income?

Multiple Choice

$40,000

$100,000

$20,000

$120,000

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