Calculating Residual Income Pelican Manufacturing earned operating income last year as shown in the following income statement: Sales Cost of goods sold $531,250 280,000 $251,250 196,300 $54,950 21,980 $32,970 Gross margin Selling and administrative expense Operating income Less: Income taxes (@ 40%) Net income At the beginning of the year, the value of operating assets was $390,000. At the end of the year, the value of operating assets was $460,000. Pelican requires a minimum rate of return of 10%. Required: For Pelican, calculate 1. Average operating assets 2. Residual income