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Luke Company has three divisions: Peak, View, and Grand. The company has a hurdle rate of 5.76 percent. Selected operating data for the three divisions
Luke Company has three divisions: Peak, View, and Grand. The company has a hurdle rate of 5.76 percent. Selected operating data for the three divisions follow: Peak View Sales revenue Cost of goods sold Miscellaneous operating expenses Average invested assets Grand $ 344,000 $ 221,000 $ 314,000 210,000 108,000 193,000 37,000 40,000 31,000 1,260,000 930,000 1,115,000 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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