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Consider the following data (in millions) from Trident Financial Inc., which has two main divisions, mortgage loans and consumer loans Average total assets Operating income
Consider the following data (in millions) from Trident Financial Inc., which has two main divisions, mortgage loans and consumer loans Average total assets Operating income Return on investment (ROI) Mortgage Loans $ 2,000 $ 400 208 Consumer Loans $ 20,000 $ 2,500 12.5% Required: 1. Based on ROI, which division is more successful? O Mortgage loans O Consumer loans 2. Trident uses residual income (RI) as a measure of the financial performance of its divisions. What is the RI for each division of the minimum desired rate of return is (a) 10%, (b) 15%, and (c) 20%? (Leave no cells blank. Enter "o" wherever required. Negative amounts should be indicated by a minus sign. Enter your answers in millions.) Residual Income (RI) Mortgage Consumer Loans Loans 10% (b) 15% (C) 20% VAN
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