Question
Oriole Decor sells home decor items through three distribution channelsretail stores, the Internet, and catalog sales. Each distribution channel is evaluated as an investment center.
Oriole Decor sells home decor items through three distribution channelsretail stores, the Internet, and catalog sales. Each distribution channel is evaluated as an investment center. Selected results from the latest year are as follows:
Retail Stores | Internet | Catalog Sales | ||||
---|---|---|---|---|---|---|
Sales revenue | $10,050,000 | $4,000,000 | $3,240,000 | |||
Variable expenses | 4,000,000 | 1,550,000 | 1,850,000 | |||
Direct fixed expenses | 4,500,000 | 1,050,000 | 1,250,000 | |||
Average assets | 8,000,000 | 4,000,000 | 1,680,000 | |||
Required rate of return | 10% | 10% | 10% |
(a)Calculate the current residual income for each distribution channel. (If the residual income is a loss then enter with a negative sign preceding the number, e.g. -5,125 or parenthesis, e.g. (5,125).)
Residual Income | ||
---|---|---|
Retail | $enter a dollar amount | |
Online | $enter a dollar amount | |
Catalog | $enter a dollar amount |
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