Required information Problem 14-63, 14-64 (Algo) (LO 14-1, 2, 3, 4) Bentler Industries provides high-technology navigation and communication equipment for the aerospace and shipbuilding industries. It is organized into two divisions, Aeronautics and Marine. The division presidents are given wide decision- making authority that covers operations, marketing, and asset acquisition and disposal Bentler evaluates the division presidents on, among other things, ROI in their respective divisions. ROI is based on after-tax divisional income and beginning-of-year assets. Divisional income includes allocated corporate overhead. For the most recent year (year 3), data from the two divisions shows the following: Aeronautics Division Marine Division Allocated corporate overhead (5000) Cost of sales $15,000 $13,000 19,300 14,400 other general and administrative costs R&D costs 990 2,050 17,400 4,800 Sales 56,000 40.000 Total assets (January 1,Year 3) 29,200 37,200 The tax rate applied at Bentler is 20 percent. Problem 14-63 (Algo) Divisional Income, ROI, and Residual Income (LO 14-1, 2, 3) Required: a. Compute divisional income for year 3 for each of the divisions. b1. Evaluate the two divisions based on the information from the divisional income computed b2. In terms of divisional income, which division performed better? c1. Compute ROI for year 3 for each of the divisions. c2. Which division performed better? d1. Compute residual income for year 3 for each of the divisions. Bentler uses a cost of capital of 12 percent. d2. Which division performed better? Complete this question by entering your answers in the tabs below. Req A Req B1 Req B2 Req C1 Reg C2 Req D1 Req D2 Compute divisional income for year 3 for each of the divisions. Note: Enter your answers in thousands of dollars. Aeronautics Division Marine Division Divisional income Req B1 > Complete this question by entering your answers in the tabs below. Req A Req B1 Req B2 Req C1 Req C2 Req D1 Req D2 Evaluate the two divisions based on the information from the divisional income computed, Note: Enter your answers as a percentage rounded to 2 decimal places (ie., 32.12). Gross margin Operating margin Profit margin Aeronautics Division Marine Division % % % % % % < Req A Req B2 > Complete this question by entering your answers in the tabs below. Req A Req B1 Req B2 Req C1 Req C2 Req D1 Req D2 In terms of divisional income, which division performed better? In terms of divisional income, which division performed better? < Req B1 Req C1 > Complete this question by entering your answers in the tabs below. Req A Req B1 Req B2 Req C1 Req C2 Req D1 Req D2 Compute ROI for year 3 for each of the divisions. Note: Enter your answers as a percentage rounded to 2 decimal places (i.e., 32.12)" at indicated place. Aeronautics Division Marine Division ROI % % Complete this question by entering your answers in the tabs below. Req A Req B1 Req B2 Req C1 Req C2 Req D1 Req D2 Which division performed better? Which division performed better? < Req C1 Req D1 > Complete this question by entering your answers in the tabs below. Req A Req B1 Req B2 Req C1 Req 02 Req D1 Req D2 Compute residual income for year 3 for each of the divisions. Bentler uses a cost of capital of 12 percent. Note: Enter your answers in thousands of dollars. Negative amounts should be indicated by a minus sign. Residual income Aeronautics Division Marine Division < Req C2 Req D2 > Complete this question by entering your answers in the tabs below. Req A Req B1 Req B2 Req C1 Req C2 Req D1 Req D2 Which division performed better? Which division performed better? < Req D1