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Sapsora Company uses ROl to measure the performance of its operating divisions and to reward division managers. A summary of the annual reports from two

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Sapsora Company uses ROl to measure the performance of its operating divisions and to reward division managers. A summary of the annual reports from two divisions is shown as follows. The company's weighted-average cost of capital is 10 percent. Total assets Current liabilities After-tax operating income Division A $ 6,380,000 $ 800,000 $ 1,120,000 Division B $ 8,370,000 $ 1,950,000 1,204,000 ROI 24% 13% a. Which division is more profitable in absolute dollars? b. Compute the EVA for Division A and Division B c. Suppose the manager of Division A was offered a one-year project that would increase his investment base by $350,000 and show a profit of $38,500. Would the manager be motivated to invest in the new project

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