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Sandhill Decor sells home decor items through three distribution channels-retail stores, the Internet, and catalog sales. Each distribution channel is evaluated as an investment center.
Sandhill Decor sells home decor items through three distribution channels-retail stores, the Internet, and catalog sales. Each distribution channel is evaluated as an investment center. Selected results from the latest year are as follows: Retail Stores Internet Catalog Sales Sales revenue $10,100,000 $4,050,000 $3,360,000 Variable expenses 4,050,000 1,600,000 1,900,000 Direct fixed expenses 4,550,000 1,100,000 1,300,000 Average assets 8,050,000 4,050,000 1,630,000 Required rate of return 11% 11% 11% (a) Calculate the current residual income for each distribution channel. (If the residual income is a loss then enter with a negative sign preceding the number, e.g.-5,125 or parenthesis, e.g. (5,125).) Residual Income $ Retail $ Online $ Catalog
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