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Luke Company has three divisions: Peak, View, and Grand. The company has a hurdle rate of 6.01 percent. Selected operating data for a the three
Luke Company has three divisions: Peak, View, and Grand. The company has a hurdle rate of 6.01 percent. Selected operating data for a the three divisions follow. Sales revenue Cost of goods sold Miscellaneous operating expenses Average invested assets Peak View Grand $ 337,000 $ 233,000 $ 316,000 205,000 113,000 189,000 35,000 33,000 32,000 1,240,000 950,000 1,035,000 Required: 1. Compute the return on investment for each division. 2. Compute the residual income for each division Complete this question by entering your answers in the tabs below. Required 1 Required 2 Compute the return on investment for each division. (Enter your ROI answers as a percentage rounded to two decimal places, (i.e., 0.1234 should be entered as 12.34%.)) Peak View Grand Return on Investment % % %
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