Question 3 [25 marks, 25%] The Car Company provided the following income statement for the last year: Sales $1,040,000 Less: Variable Expenses 700,250 Contribution margin $339,750 Less: Fixed expenses 183,750 Operating income $156,000 Operating assets of the Car Company were: At the beginning of the last year $28,300 At the end of the last year $23,700 Required: 1. Compute average operating assets [3 marks] 2. Compute the profit margin and the turnover ratio for last year [6 marks] 3. Compute ROI [3 marks] 4. Assume that the minimum acceptable rate of return for the Car Company is 6%. Calculate the residual income for the Car Company [5 marks] 5. Briefly explain why good managers should use a combination of methods (e.g., ROI and residual income) to evaluate performance of the investment centres [8 marks]