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Orange Corp. has two divisions: Fruit and Flower. The following information for the past year is available for each division: Fruit Division Flower D $1,440,000
Orange Corp. has two divisions: Fruit and Flower. The following information for the past year is available for each division: Fruit Division Flower D $1,440,000 2,160,000 Sales revenue Cost of goods sold and operating expenses Net operating income Average invested assets 1,080,000 360,000 S $ 3,000,000 S 2,160,000 Orange has established a hurdle rate of 8 percent. Required: 1-a. Compute each division's return on investment (ROI) and residual income for last year. (Enter your ROl answers as a percentage rounded to two decimal places, (i.e., 0.1234 should be entered as 12.34%-)) Fruit Division Flower Division ROI Residual Income (Loss) 1-b. Determine which manager seems to be performing better. Fruit Division O Flower Division
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