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Lauderdale Corporation is organized in three geographical divisions (rogions) with managers respansible for revenues, costs, and assets in their respective regions. The fim is highy
Lauderdale Corporation is organized in three geographical divisions (rogions) with managers respansible for revenues, costs, and assets in their respective regions. The fim is highy decentralized and managers are evaluated solely on divisional performance. Corporate overhead (all foxed) is allocated to the regions based on reglonal gross margin (regionat revenue mintis reqionat cont of sales). The following information is from Lauderdales first year of operations: Information on the division assets in the three regions of Lauderdaie Corporation follows: Lauderdale Corporation has a cost of capital of 8.6 percent. The individual regions are responsible for research and development (R\&D) decisions and for current llabilities. Information on R\&D expenditures (which are included in SG\&A) for the year and current liabilities for the three regions follows: RED expenditures are assumed to be incurred uniformly over the period and are expected to generate benefits for three years. Required: a. Compute economic value added for the three regions. Ignore taxes. . How have these regions performed? Complete this question by entering your answers in the tabs below. Region III 1,314,500 Lauderdale Corporation has a cost of capital of 8.6 percent. The individual regions are responsible for research and development (R\&D) decisions and for current llablities, information on R\&D RRD expenditures are assumed to be incurred uniformly over the periou an ...e expected to generate benefits for three years. Required: a. Compute economic value added for the three regions. Ignore taxes. b. How have these regions performed? Complete this question by entering your answers in the tabs below. Compute economic value added for the three regions. Ignore taxes. Compute economic value added for the three regions
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