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Required information [The following information applies to the questions displayed below.) A food manufacturer reports the following for two of its divisions for a recent
Required information [The following information applies to the questions displayed below.) A food manufacturer reports the following for two of its divisions for a recent year. ($ millions) Invested assets, beginning Invested assets, ending Sales Operating income Beverage Division $2,669 2,597 2,685 353 Cheese Division $4,462 4,404 3,929 638 Assume that each of the company's divisions has a required rate of return of 5%. Compute residual income for each division. (Enter your answers in millions.) Cheese Beverage $ 2,597 5% $ 353 ($ millions) Average assets Targeted return Target income Residual Income Average assets Less: Target income Residual income Beverage Cheese
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