Peter is the manager of the Home Care Products Division of Peter Senen Corporation. As a manager of an investment center, Peter performance is measured using the residual income method. For the coming year, Peter wants to achieve a residual income target of P100,000 using an imputed interest charge of 20%. Other forecasted figures for the coming year are as follows: Working capital P90,000 Plant and Equipment 860,000 costs and expenses 1,210,000 How much should revenues be next year to achieve the residual income target? O b. P1.300.000 O d. P1,464,000 O c. P1.500.000 O a. P1.482.000 Ethel is the manager of the Manila Division of JYD Company. The Manila Division is treated as an investment center whose performance is evaluated using the residual income method. For the coming period, Ethel expects to incur total costs and expenses of P1,210,000. The expected investment in the division for the same period is P950,000, composed of working capital of P90,000 and plant and equipment of P860,000. To establish a standard of performance for the performance of Ethel in the coming period, four scenarios are being considered: Desired Rate of Return Target Residual Income Scenario 1 10% P125,000 Scenario 2 12% 75.000 Scenario 3 15% 100.000 Scenario 4 18% 62.500 Which scenario assumes the highest revenue? Oc.3 O d. 4 O a. 1 O b.2