Question 6 Time: 20 minutes Total: 12 marks Mary's Auto Shop Inc. allows its divisions to operate as autonomous units. Their results for the current year were as follows: Revenues Current assets Capital assets Current liabilities Net operating income After-tax income Weighted average cost of capital Sport Terrain $2,200,000 $995,000 290,000 90,000 870,000 660,000 100,000 100,000 230,000 40,000 184,000 32,000 City $6,600,000 620,000 1,590,000 500,000 600,000 480,000 10% 10% 10% Required: For each division compute (to two decimal) the: 1. Return on sales in % 2. Return on investment (to two decimal) based on total assets employed in % 3. Economic value added 4. Residual income based on net operating income