Lauderdale Corporation is organized in three geographical divisions (regions) with managers responsible for revenues, costs, and assets in their respective regions. The firm is highly decentralized and managers are evaluated solely on divisional performance Corporate overhead (all fixed) is allocated to the regions based on regional gross margin (regional revenue minus regional cost of sales) The following information is from Lauderdale's first year of operations: Revenues Colt of sales Selling, General and Administrative (all fixed) Corporate overhead Region I $ 1,217,000 Region II $1,676,000 458,500 818,500 445,500 655,500 Region III $ 2,267,000 1,148,500 875,500 Total Corporation $ 5,160,000 2,425,500 1,976,500 Information on the division assets in the three regions of Lauderdale Corporation follows: Region I Region II Region III $ 717,000 647,000 1,313,000 Lauderdale Corporation has a cost of capital of 8.6 percent. Required: a. Compute residual income for the three regions. Ignore taxes. b. How have these regions performed? Complete this question by entering your answers in the tabs below. 466,000 Required A Required B