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Residual Income The income from operations and the amount of invested assets in each division of Beck Industries are as follows: Income from Operations Invested
Residual Income The income from operations and the amount of invested assets in each division of Beck Industries are as follows: Income from Operations Invested Assets Retail Division $106.000 $530,000 Commercial Division 79,900 470,000 Internet Division 160,800 670,000 Assume that management has established a 8% minimum acceptable return for invested assets. a. Determine the residual income for each division. Retail Division Internet Division Commercial Division $79,900 $160,800 Income from operations Minimum acceptable income from operations as a percent of invested assets $106,000 63,600 Residual income b. Which division has the most residual income? Internet Division
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