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Question 1 1. An investment centre in a manufacturing group produced the following results in the previous financial year s'000 360 1,500 100 Operating profit Capital employed: non-current assets Current assets For the purpose of performance mea surement, non-current assets are valued at cost. The investment centre is cons dering a new investment that will increase annual operating profit by $25,000, and will require an investment of $100,000 in a non-current asset and an additional $30,000 in working capital. Assume a notional capital charge of 18% on divisional capital. (6 marks) a) Calculate ROI and RI b) Will the performance measuremert criteria of (1) return on investment (ROI) and (2) residual income (RI) moti rate the centre manager to undertake the investment? (4 marks) c) Discuss the advantages and limitetion of RI and ROI in making investment (10 marks) (Total 20 marks) decisions