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	$5,400,000		$30,000,000
Commercial Division	6,250,000		25,000,000
Internet Division	1,800,000		12,000,000

Assume that management has established a 9% minimum acceptable return for invested assets.

a. Determine the residual income for each division.

	Retail Division		Commercial Division		Internet Division
Income from operations	$5,400,000		$6,250,000		$1,800,000
Minimum amount of income from operations
Residual income	$		$		$