Megatronics Corporation, a mossive tetatier of electronic pectucts, is organized in four separate divisions. The four divisional managers are evaluated at year-end, and bonuses are iwarded based on ROL. Last yeat, the company as a whole produced a 15 percent return on its investment. During the past week, management of the company's Northeast Division was approached about the possiblity of buying a competitor that had decided to redirect its retal activies. ( the competitor is acquired, it will be acquired at its book value) The date that follow relate to recent performance of the Northeast Division and the competitor: Management has desermined that in order to upgrade the competitot to Megatronics" standards, an additional $120,000 of invested capital would be needied Required: 1. Compute the currest ROI of the Northeast Dission and the oivisiris ROI if the competitor b acquired; 2. If divisional management is being evsluated on the basis of ROt, will the Hortheast Division likely pursue aceuivition of the competitor? 3. 3. Compite the ROI of the competitor is it is now and after the intended uporade. 3.b. If ROI is used as the basis for evaluation, would Megatronsics Corporation iwely be in favor of the acouisition of the compettor? 4. Caiculate the Northeast Dividion's Rot after acquistion of competitor but before uperading 5-a. Assume that Megatronics uses residual income to evaluate performance and desires a 12 percent minimum return on invested capital. Compute the cuntent residusi inconve of the Northease D.ision and the division's residual income if the compet tor in acquired 5. b. If divisionai management is being evalusted on the basis of residual income, will the Nartheast Division ticoly pursue accuivition of tive competitor? Complete this question by entering your answers in the tabs below. Management has determined that in order to upgrade the compotior to Megatronics standards, an additional 5120,000 of invested copital would be needed Required: 1. Compute the current ROI of the Northeost Division and the division's ROI if the coenpetitor is acquiled. 2. If divisional management is being evaluated on the basis of ROI, will the Northeass Division likely pursue acquistion of the competitor? 3. a. Compute the ROI of the competzor as it is now and after the intended upgrade. 3-b. If ROI is used as the basis for evaluation, would Mogatronics Corporation likely be in favor of the acquisition of the competitor? 4. Caiculate the Northeast Oivision's fOI after acquisition of compettor but before uperrading. 5-a. Assume that Megatronics uses tesidual income to evatuote performance and desires a 12 percent mirimum return on invested capital, Compute the current resldusl incorte of the Northeast Division and the dision's residual income if the competitor is acquired; 5-b. If divisional management is being evaluated on the basis of residual income, will the Northeast Oivison likely purnue acquitition of the compottor? Cempiete this question by entering your answers in the tabs below