Back Mountain Industries (BMI) has two divisions: East and West. BMI has a cost of capital of 15 percent. Selected financial information (in thousands of dollars) for the first year of business follows Sales revenue Income Investment (beginning of year) Current liabilities (beginning of year) West $1,000 $5,000 390 2,0003,000 200 400 East 200 200 R&D expenditures 500 R&D is assumed to benefit two periods. All R&D is spent at the beginning of the year Required a-1. Evaluate the performance of the two divisions assuming BMI uses residual income. (Enter answers in thousands of dollars. Negative amounts should be indicated by a minus sign.) Residual Divisions Income East West a-2. Which division had the better performance? East West