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Please help with the below questions. Thanks. QUESTION 3 EuroInvestment Company has three divisions. Each division's required rate of return is 14%. The operating results

Please help with the below questions. Thanks.

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QUESTION 3 EuroInvestment Company has three divisions. Each division's required rate of return is 14%. The operating results for 2020 based on current operations are expected to be as follows: mun 15,000,000 100,000,000 _ 25,000,000 125,000,000 11,000,000 50,000,000 Divisional managers earn a bonus of 50,000 for each percentage of return on investment (ROI) over 14%. Suppose each division has the opportunity to invest 25 ,000,000 whereby the division's income would increase by 4,500,000. REQUIRED: (a) Will the three divisional managers accept the investment opportunity? Explain llly showing all calculations. [4 marks] (b) If EuroInvestment Company used residual income (RI) to judge and reward the managerial performance of its divisional managers instead of ROI, would your answer to part (a) change? Explain fully showing all calculations. [4 marks] (c) Is ROI preferable to R1 for EuroInvestment Company to use in evaluating the performance of its divisional managers? [4 marks]

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