Sherwin Corporation has three business segments: paint, wallpapers, and tools. The company's assumed cost of capital is 10%. Financial information about each segment follows: Wallpaper Paint segment Tools segment segment 475,000 Segment operating income Invested capital $ 650,000 6,500,000 $ 900,000 7,500,000 3,500,000 (a) Prepare an analysis of residual income for each segment, and note which segment has the highest residual income. (b) Assuming a reduction in assumed cost of capital to 5%, prepare a revised analysis of residual income. Does this revised assumption alter the rankings? (a) Paint Wallpaper Tools segment segment segment Segment operating income Residual income (b) Segment operating income Residual income $ 69 Paint segment $ $ 69 $ Wallpaper segment $ Fal Tools segment