Required information Use the following information for the Exercises below [The following information applies to the questions displayed below.] Megamart, a retailer of consumer goods, provides the following information on two of its departments (each considered an investment center). Investment Center Electronics Sporting goods Sales Income $40,000,000 $2,880,000 20,000,000 2,040,000 Average Invested Assets $ 16,000,000 12,000,000 Exercise 09-10 Computing return on investment and residual income; investing decision LO A1 1. Compute return on investment for each department. Using return on investment, which department is most efficient at using assets to generate returns for the company? 2. Assume a target income level of 12% of average invested assets. Compute residual income for each department. Which department generated the most residual income for the company? 3. Assume the Electronics department is presented with a new investment opportunity that will yield a 15% return on investment. Should the new investment opportunity be accepted? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Compute return on investment for each department. Using return on investment, which department is most efficient at using assets to generate returns for the company? Return on Investment Choose Numerator: 1 Choose Denominator: Return on Investment Net income 1 Sales = Return on Investment 0 Electronics $ 2,880,000/ Sporting Goods $ 2,040,000 / Which department is most efficient at using assets to generate returns for the company? 0 Required 1 Required 2 > Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Assume a target income level of 12% of average invested assets. Compute residual income for each department. Which department generated the most residual income for the company? Investment Center Electronics Sporting Goods Net income Target net income 960,000 600,000 Residual income $ Which department is most efficient at using assets to generate returns for the company? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Assume the Electronics department is presented with a new investment opportunity that will yield a 15% return on investment. Should the new investment opportunity be accepted? Should the new investment opportunity be accepted?