Comart, a retailer of consumer goods, provides the following information on two of its departments (each considered an investment center).

Investment Center		Sales		Net Income	Average Invested Assets
Electronics	$	10,200,000	$	622,500	$	4,150,000
Sporting goods		7,900,000		630,000		4,500,000

(1.1)

Compute return on investment for each department. (Do not round your intermediate calculations and round your final answers to the nearest whole percentages. Omit the "%" sign in your response.)

	Return on Investment
Electronics	%
Sporting goods	%

(1.2)

Using return on investment, which department is most efficient at using assets to generate returns for the company?

	Sporting goods
	Electronics

(2.1)

Assume a target income level of 11.8% of average invested assets. Compute residual income for each department. (Omit the "$" sign in your response.)

	Electronics	Sporting goods
Residual income	$	$

(2.2)

Which department generated the most residual income for the company?

	Sporting goods
	Electronics

(3)	Assume the Electronics department is presented with a new investment opportunity that will yield a 14.4% return on assets. (Assume a target income level of 11.8% of average invested assets.) Should the new investment opportunity be accepted?

	Accept
	Reject