Exercise $10-2($Algo$)$ Residual Income $[$LO$10-2]$

Juniper Design Limited of Manchester, England, is a company specializing in providing design services to residential developers. Last year the company had net operating income of $$400,000$ on sales of $$1,000,000.$ The company's average operating assets for the year were $$1,200,000$ and its minimum required rate of return was $13\%.$

Required:

Compute the company's residual income for the year.

Answer is complete but not entirely correct.

Residual income

$ $213,000ox$