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Gletchen Cough Drops operates two divisions. The following information pertains to each division for 2017: Sales Operating income Average operating assets Company's desired rate of
Gletchen Cough Drops operates two divisions. The following information pertains to each division for 2017: Sales Operating income Average operating assets Company's desired rate of return Division A Division B $ 480,000 $300,000 $ 32,000 $ 24,000 $200,000 $160,000 10% 10% Required a. Compute each division's residual income. b. Which division increased the company's profitability more? Residual Income Division A Division B The division that increased the company's profitability more is
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