Coronado Corporation recorded operating data for its Waterhole division for the year. Coronado requires a 9.00% rate of return.

Sales	$502000
Controllable margin	92000
Total average assets	400000
Fixed costs	35000
Residual income	54000

Suppose Coronado experiences an increase of $54000 in controllable fixed costs. Will the new ROI be acceptable?

A. Yes. The ROI will remain at 23% which exceeds the required ROI.

B. Yes. The new ROI is still above the required ROI.

C. No. The ROI drops to less than 9.00%.

D. There is not enough information to determine the new ROI.