Coolbrook Company has the following information available for the past year: The companys hurdle rate is 7.26 percent. 1. Calculate return on investment (ROI) and residual income for each division for last year. (Enter your ROI answers as a percentage rounded to two decimal places, (i.e., 0.1234 should be entered as 12.34%.)) 2. Recalculate ROI and residual income for each division for each independent situation that follows: (Enter your ROI answers as a percentage rounded to two decimal places, (i.e., 0.1234 should be entered as 12.34%.)) a. Operating income increases by 11 percent. b. Operating income decreases by 10 percent. c. The company invests $249,000 in each division, an amount that generates $114,000 additional income per division. d. Coolbrook changes its hurdle rate to 5.26 percent.

Stream Division River Division $ 1,211,000 S 1,814,000 1,299,000 Sales revenue Cost of goods sold and operating expenses Net operating income Average invested assets 887 000 1299,000 $ 324,000 S 515,000 $ 1,190,000 $ 1,500,000