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Question 31 Gamma Company Ltd determined residual income for the year of $36,000. The company's cost of capital was 12.5 per cent, the investment turnover

Question 31

Gamma Company Ltd determined residual income for the year of $36,000. The company's cost of capital was 12.5 per cent, the investment turnover was 2.0, and capital invested was $380,000. What was Gamma Company's profit during the year?

a.
$83,500

b.
$70,000

c.
$47,500

d.
None of the answers.

e.
$190,000

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