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PLEASE help me solve these two problems! much much appreciated :) M10-10 (Algo) Impact of New Investment on ROI, Residual Income [LO 10-4, 10-5] The
PLEASE help me solve these two problems! much much appreciated :)
M10-10 (Algo) Impact of New Investment on ROI, Residual Income [LO 10-4, 10-5] The Western Division of Claremont Company had net operating income of $135,000 and average invested assets of $557,000. Claremont has a required rate of return of 14.50 percent. Western has an opportunity to increase operating income by $40,000 with a $100,000 investment in assets. Compute Western Division's return on investment and residual income currently and if it undertakes the project. Note: Enter your ROI answers as a percentage rounded to two decimal places, (i.e., 0.1234 should be entered as 12.34% ). Round your Residual Income (Loss) answers to the nearest whole dollar. M10-9 (Algo) Calculating Return on Investment, Residual Income [LO 10-4, 10-5] Augusta Corporation's Golf Division has sales of $194,000, cost of goods sold of $104,000, operating expenses of $29,000, average invested assets of $904,000, and a hurdle rate of 13.25 percent. Calculate the Golf Division's return on investment and its residual income. Note: Enter loss amount with a minus sign. Enter your ROI answer as a percentage rounded to two decimal places, (i.e., 0.1234 should be entered as 12.34\%). Round your Residual Income (Loss) answer to the nearest whole dollarStep by Step Solution
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