Juara Machinery Berhad has two divisions namely West Division and East Division. The divisions are treated as investment centres and end of financial year they will prepare an operating statement to be submitted to Juara Machinery Berhad. Operating statements for these two divisions are shown below: West Division (RM) East Division (RM) Sales revenue 1500,000 600 000 Less: Variable costs 450,000 320.000 Contribution margin 1,050,000 280,000 Less: Fixed cost 100 000 30,000 Less: Apportioned central cost 330,000 150 000 620,000 100,000 Net income before tax Total divisional net assets 9,750,000 BB80,000 Juara Machinery currently has a target retum on capital of 10% per year. However, Juara Machinery believes its cost of capital is likely to rise and is considering increasing the target return on capital Required: (Show all calculations) (a) Compute the return on investment (ROI) in percentage for each division and discuss the relative performance of the two divisions. (b) Compute the residual income (RI) for each division and explain the implications of this information for the evaluation of the division's performance. (c) ROI and RI Explain two further methods of assessment of divisional performance that could be used in addition to