In 2021, the following calculations were made for SP Corporation: Return on investment 24% Average operating assets Minimum required rate of return The residual income for SP Corporation was: Multiple Choice O $9,800 $8,400 $3,600 O $6,750 $ 45,000 16 % Bow Wow Products manufactures dog biscuits that are advertised to help with digestion. Sales for these biscuits have been less than some of their other products, and management at Bow Wow is considering whether they would discontinue the manuacture and sale of the dog biscuits. The Bow Wow cost accountants have compiled the following information regarding the dog biscuit product line: Sales Variable expenses Fixed manufacturing expenses Fixed selling and administrative expenses The cost accountants have determined that $181,000 of the fixed manufacturing expenses would be avoidable if the dog biscuits product line was discontinued. In addition, $156,900 of the fixed selling and administrative expenses would be avoidable. $ 753,200 $ 391,300 $ 256,200 $ 218,600 Required: How would you advise management at Bow Wow Products? Should the dog biscuit product line be dropped? Net operating income (loss) would by if the dog biscuit product line was dropped. Therefore, the product dropped Multiple Choice $30,000 Premium Paper Corporation has a division that manufactures recipe cards. Since more and more people are storing their recipes electronically, Premium Paper is considering whether they should eliminate the Recipe Cards Division. The division has an annual contribution margin of $26,000 and has $74,000 in fixed costs per year. $18,000 of the Recipe Cards Division's fixed costs cannot be avoided. If Premium Paper eliminates the Recipe Cards Division, what financial advantage (or disadvantage) would the company recognize per year? ($48,000) $48,000 Saved ($30,000) Help Save & Exit