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Care Inc., has two divisions that operate independently of one another. The financial data for the year 2015 reported the following results: North South Sales
Care Inc., has two divisions that operate independently of one another. The financial data for the year 2015 reported the following results: North South Sales $6,000,000 $5,000,000 Operating income 1,600,000 1,200,000 Taxable income 1,800,000 800,000 Investment 14,000,000 15,000,000 The company's desired rate of return is 10%. Income is defined as operating income. What are the respective residual incomes for the North and South Divisions? O A. $200,000 and $(300,000) O B. $300,000 and $60,000 OC. $60,000 and $100,000 OD. $300,000 and $100,000
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