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Coolbrook Company has the following information available for the past year. Sales revenue Cost of goods sold and operating expenses Net operating income Average invested

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Coolbrook Company has the following information available for the past year. Sales revenue Cost of goods sold and operating expenses Net operating income Average invested assets River Division $ 1,202,800 887,000 $ 315,000 $ 1,040,000 Stream Division $ 1,813,000 1,291,000 $ 522,000 $1,450, eee The company's hurdle rate is 776 percent Required: 1. Calculate return on investment (ROI) and residual income for each division for last year. 2. Recalculate ROI and residual income for the division for each independent situation that follows: o. Operating income increases by 9 percent. b. Operating income decreases by 10 percent. c. The company invests $251,000 in each division, an amount that generates $106,000 additional income per division d. Coolbrook changes its hurdle rate to 5.76 percent

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