Chapter 11 Segment Reporting, Transfer Pricing, and Balanced Scorecard 427 ROI and Residual Income: Impact of a New Investment The Stallion Division of Motortown Motors had an operating income of $675,000 and net assets of s2.700,000. Motortown Motors has a target rate of return of 23 percent. LO3 Required a. Compute the return on investment. b. Compute the residual income. The Stallion Division has an opportunity to increase ope $675,000 investment in assets. 1. Compute the Stallion Division's return on investment if the project is undertaken. (Rund c. rating income by $100,000 with an answer to three decimal places.) C 2. omp pute the Stallion Division's residual income if the project is undertaken