During 2018, the following information was reported by Kingfisher Enterprises and one of its divisions West division (WD):

	Operating Income	Operating assets
Kingfisher	$1,760,000	$8,000,000
WD	416,000	1,600,000

Kingfisher has offered the WD division $1,000,000 of additional operating assets to invest in a new project. The manager of WD division thinks he could generate an additional income of $240,000 from the new project. Kingfisher has a desired/target return of investment (ROI) of 20 percent.

Required:

1. Complete the following table to calculate the ROI, Desired income and Residual income for each scenarios:

(Show your calculation or write down the formula used on the top of each of the last three columns)

Entity	Operating Income (OI) $	Operating Assets (OA) $	ROI %	Desired income $	Residual Income $
Kingfisher
WD Division
New investment (NI)
WD Division with NI
Kingfisher with NI

2. Use the supporting calculations from completing the table above to explain whether the WD divisions manager would decide to undertake the additional investment opportunity assuming that:
   1. He is paid a bonus based upon her divisions total (WD + AI) ROI

He is paid a bonus based upon her divisions total (WD + AI) RI