Question
Shannon Pharmaceuticals has the following information available for one of its divisions in the current year: Salesrevenue$12 000 000 Average operatingassets4 000 000 Return on
Shannon Pharmaceuticals has the following information available for one of its divisions in the current year:
Salesrevenue$12 000 000
Average operatingassets4 000 000
Return on investment(ROI)45%
The company requires each of its divisions to generate a minimum return of 35 per cent. What is this division's residual income?
$700 000
$400 000
$450 000
$600 000
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Accounting Principles
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
13th edition
978-1-119-4110, 1119411483, 9781119411017, 978-1119411482
