Question 3 assignment 2

Residual Income Washington Company has two divisions: the Adams Division and the Jefferson Division. The following information pertains to last year's results: Adams Division Jefferson Division Net (after-tax) income $605,000 $318,150 Total capital employed 4,320,000 3,380,000 In addition, Washington Company's top management has set a minimum acceptable rate of return equal to 8%. Required: Enter negative values as negative numbers. 1. Calculate the residual income for the Adams Division 2. Calculate the residual income for the Jefferson Division