{
    "key_pair_value_system": true,
    "answer_rating_count": "",
    "question_feedback_html": {
        "html_star": "",
        "html_star_feedback": ""
    },
    "answer_average_rating_value": "",
    "answer_date_js": "2024-06-28T06:52:19-04:00",
    "answer_date": "2024-06-28 06:52:19",
    "is_docs_available": null,
    "is_excel_available": null,
    "is_pdf_available": null,
    "count_file_available": 0,
    "main_page": "student_question_view",
    "question_id": "4257096",
    "url": "\/study-help\/questions\/ocean-division-currently-earns-780000-and-has-divisional-assets-of-4257096",
    "question_creation_date_js": "2024-06-28T06:52:19-04:00",
    "question_creation_date": "Jun 28, 2024 06:52 AM",
    "meta_title": "[Solved] Ocean Division currently earns $780,000 a | SolutionInn",
    "meta_description": "Answer of - Ocean Division currently earns $780,000 and has divisional assets of $3.9 million. The division manager is considering | SolutionInn",
    "meta_keywords": "ocean,division,earns,$780,000,divisional,assets,$3.9,million,manager,acquisition,new,asset",
    "question_title_h1": "Ocean Division currently earns $780,000 and has divisional assets of $3.9 million. The division manager is considering the acquisition of a new asset that will",
    "question_title": "Ocean Division currently earns $780,000 and has divisional assets of $3.9 million.",
    "question_title_for_js_snippet": "Ocean Division currently earns $780,000 and has divisional assets of $3 9 million  The division manager is considering the acquisition of a new asset that will add to profit  The investment has a cost of $675,000 and will have a yearly cash flow of $168,000  The asset will be depreciated using the straight line method over a six year life and is expected to have no salvage value  Divisional performance is measured using ROI with beginning of year net book values in the denominator  The company's cost of capital is 15 percent  Ignore taxes  The division manager learns that he has the option to lease the asset on a year to year lease for $148,000 per year  All depreciation and other tax benefits would accrue to the lessor  Required  (a) What is the division's residual income before considering the project  (Enter your answers in dollars and not in millions of dollars ) (b) What is the division's residual income if the asset is purchased  (Enter your answers in dollars and not in millions of dollars ) (c) What is the division's residual income if the asset is leased ",
    "question_description": "<p>Ocean Division currently earns $780,000 and has divisional assets of $3.9 million. The division manager is considering the acquisition of a new asset that will add to profit. The investment has a cost of $675,000 and will have a yearly cash flow of $168,000. The asset will be depreciated using the straight-line method over a six-year life and is expected to have no salvage value. Divisional performance is measured using ROI with beginning-of-year net book values in the denominator. The company's cost of capital is 15 percent. Ignore taxes. The division manager learns that he has the option to lease the asset on a year-to-year lease for $148,000 per year. All depreciation and other tax benefits would accrue to the lessor. Required: (a) What is the division's residual income before considering the project? (Enter your answers in dollars and not in millions of dollars.) (b) What is the division's residual income if the asset is purchased? (Enter your answers in dollars and not in millions of dollars.) (c) What is the division's residual income if the asset is leased?<\/p>",
    "transcribed_text": "",
    "related_book": {
        "title": "Auditing Cases An Active Learning Approach",
        "isbn": "0130674842, 978-0130674845",
        "edition": "2nd Edition",
        "authors": "Mark S. Beasley, Frank A. Buckless, Steven M. Glover, Douglas F. Prawitt",
        "cover_image": "https:\/\/dsd5zvtm8ll6.cloudfront.net\/si.question.images\/book_images\/64ed8a8041add_6938.jpg",
        "uri": "\/textbooks\/abnormal-psychology-clinical-perspectives-on-psychological-disorders-1st-edition-9781266566899",
        "see_more_uri": ""
    },
    "free_related_book": {
        "isbn": "B08BWHQ85Y",
        "uri": "\/textbooks\/how-to-2x-business-revenue-profits-and-value-1st-edition-979-8653307171-280709",
        "name": "How To 2x Business Revenue Profits And Value",
        "edition": "1st Edition"
    },
    "question_posted": "2024-06-28 06:52:19",
    "see_more_questions_link": "\/study-help\/questions\/business-banking-2021-September-12",
    "step_by_step_answer": "The Answer is in the image, click to view ...",
    "students_also_viewed": [
        {
            "url": "\/lakeway-thrift-savings-and-trust-is-interested-in-doing-some",
            "description": "Lakeway Thrift Savings and Trust is interested in doing some investment portfolio shifting. This institution has had a good year thus far, with strong loan demand; its loan revenue has increased by...",
            "stars": 3
        },
        {
            "url": "\/study-help\/psychology\/what-if-any-financial-support-do-they-provide-their-students-1980919",
            "description": "What, if any, financial support do they provide their students?",
            "stars": 3
        },
        {
            "url": "\/in-a-joint-process-sylvias-styles-produces-precut-fabrics-for",
            "description": "In a joint process, Sylvia's Styles produces precut fabrics for three products: dresses, jackets, and blouses. Joint cost is allocated on the basis of relative sales value at split-off. The company...",
            "stars": 3
        },
        {
            "url": "\/study-help\/questions\/in-this-project-you-will-implement-an-electricity-data-structure-9864521",
            "description": "In this project, you will implement an Electricity data structure using combined AVL trees. The figure that i gave shows the overall data structure, i need to read from a file that has this format (...",
            "stars": 3
        },
        {
            "url": "\/study-help\/questions\/14-joud-manufacturing-produces-a-special-valve-and-has-the-7416902",
            "description": "14 JOUD Manufacturing produces a special valve, and has the capacity to produce 50,000 valves annually. Currently JOUD produces 40,000 valves and is thinking about increasing production to 45,000...",
            "stars": 3
        },
        {
            "url": "\/study-help\/questions\/jeok-claims-he-brought-a-trick-coin-from-a-casino-1003501",
            "description": "Je-ok claims he brought a trick coin from a casino. In particular, he claims that the coin is more likey to come up heads than tails. To validate his claim, he flips the coin 10 times, and it comes...",
            "stars": 3
        },
        {
            "url": "\/study-help\/questions\/a-coin-is-dropped-from-a-height-of-one-meter-1610274",
            "description": "A coin is dropped from a height of one meter and is observed to bounce half of the previous maximum height reached. What is the total vertical distance covered by the coin until at halts? A . 2 m B ....",
            "stars": 3
        },
        {
            "url": "\/study-help\/questions\/nicky-was-listening-to-one-of-her-classmates-give-a-1544021",
            "description": "Nicky was listening to one of her classmates give a speech about architecture in the city. At one point, the speaker used the term \"green spaces\" to describe city parks. Nicky heard the word \"green\"...",
            "stars": 3
        },
        {
            "url": "\/study-help\/questions\/throughout-clays-speech-on-the-environment-he-reviewed-points-previously-1782312",
            "description": "Throughout Clay's speech on the environment, he reviewed points previously discussed before introducing new points. What is the textbook term for this technique? preview O transition O internal...",
            "stars": 3
        },
        {
            "url": "\/study-help\/questions\/perez-pops-please-read-the-instructions-carefully-a-new-client-1693673",
            "description": "Perez POPS Please read the instructions carefully. A new client of yours, Katie Perez wants to open an ice cream shop near the downtown shopping center. She will selling Frozen POPS, Frozen Ices,...",
            "stars": 3
        }
    ],
    "next_back_navigation": {
        "previous": "\/study-help\/questions\/how-can-i-develop-a-vertical-audit-form-for-customer-4257095",
        "next": "\/study-help\/questions\/you-have-to-visit-the-websites-of-sedar-and-study-4257097"
    },
    "breadcrumbs": [
        {
            "name": "Study help",
            "link": "https:\/\/www.solutioninn.com\/study-help\/questions-and-answers"
        },
        {
            "name": "Business",
            "link": "https:\/\/www.solutioninn.com\/study-help\/questions-and-answers\/business"
        },
        {
            "name": "Accounting",
            "link": "https:\/\/www.solutioninn.com\/study-help\/questions\/business-accounting"
        },
        {
            "name": "Ocean Division currently earns $780,000 and has divisional assets of $3.9 million.",
            "link": "https:\/\/www.solutioninn.com\/study-help\/questions\/ocean-division-currently-earns-780000-and-has-divisional-assets-of-4257096"
        }
    ],
    "skill_details": {
        "skill_id": "9",
        "skill_name": "Accounting",
        "parent_id": "1"
    }
}
}