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Required information Use the following information for the Exercises below. ( Static ) [ The following information applies to the questions displayed below. ] Megamart

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Required information
Use the following information for the Exercises below. (Static)
[The following information applies to the questions displayed below.]
Megamart provides the following information on its two investment centers.
Exercise 24-10(Static) Computing return on investment and residual income; investing decision LO A1
Compute return on investment for each center. Using return on investment, which center is most efficient at using assets to
generate income?
Assume a target income of 12% of average assets. Compute residual income for each center. Which center generated the most
residual income?
Assume the Electronics center is presented with a new investment opportunity that will yield a 15% return on investment. Should
the new investment opportunity be accepted? The target return is 12%.
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