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Save Test Sports Company makes snowboards, downhill skis, cross-country skis, skateboards, surfboards, and inline skates. The company has found it beneficial to split operations
Save Test Sports Company makes snowboards, downhill skis, cross-country skis, skateboards, surfboards, and inline skates. The company has found it beneficial to split operations into two divisions based on the climate required for the sport Snow Sports and Non-snow Sports. The following divisional information is available for the past year (Click the icon to view the information.) Test's management has specified a 17% target rate of return. Compute each division's RI. Interpret your results. Are your results consistent with each division's ROI? First, select the formula to calculate residual income (RI). Data table - X Net Sales Revenue Operating Income Average Total Assets ROI Snow Sports $ 5,200,000 $ 884,000 S 4,400,000 20.1% Non-snow Sports 8,000,000 1,360,000 6,400,000 21.3% Print Done 0 A RI o Clear all Check answer
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