Orange Corp. has two divisions: Fruit and Flower. The following information for the past year is available for each division:

Fruit division Flower division

Sales revenue $1,800,000 $2,700,000

Cost good sold & operating expense $1,440,000 $2,025,000

Net operating income $360,000 $675,000

Avg invested assets $3,600,000 $2,812,500

Orange has established a hurdle rate of 6 percent.

Compute each divisions return on investment (ROI) and residual income for last year. (Enter your ROI answers as a percentage rounded to two decimal places, (i.e., 0.1234 should be entered as 12.34%.))

Determine which manager seems to be performing better.

Suppose Orange is investing in new technology that will increase each divisions operating income by $133,000. The total investment required is $2,300,000, which will be split evenly between the two divisions. Calculate the ROI and return on investment for each division after the investment is made. (Enter your ROI answers as a percentage rounded to two decimal places, (i.e., 0.1234 should be entered as 12.34%.))

Which manager will accept the investment.