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	$	660,000		$	990,000
Cost of goods sold and operating expenses		495,000			742,500
Net operating income	$	165,000		$	247,500
Average invested assets	$	2,062,500		$	1,375,000

Orange has established a hurdle rate of 5 percent.

1. Suppose Orange is investing in new technology that will increase each divisions operating income by $120,000. The total investment required is $1,500,000, 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%.))

	Fruit Division		Flower Division
ROI		%		%
Residual Income (Loss)

2. Which manager will accept the investment.

Fruit Division Manager
Flower Division Manager