Meiji Isetan Corporation of Japan has two regional divisions with headquarters in Osaka and Yokohama. Selected data on the two

divisions follow:

Required:

For each division, compute the return on investment $($ROI$)$ in terms of margin and turnover.

Assume that the company evaluates performance using residual income and that the minimum required rate of return for any

division is $12\%.$ Compute the residual income for each division.

Is Yokohama's greater amount of residual income an indication that it is better managed?

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Required $1$

For each division, compute the return on investment $($ROI$)$ in terms of margin and turnover.