Shrewsbury Inc. reported the following results from last years operations:

Sales	$	7,200,000
Variable expenses		5,400,000
Contribution margin		1,800,000
Fixed expenses		1,296,000
Net operating income	$	504,000
Average operating assets	$	4,000,000

At the beginning of this year, the company has a $800,000 investment opportunity with the following characteristics:

Sales	$	2,480,000
Contribution margin ratio		40	% of sales
Fixed expenses	$	868,000

The companys minimum required rate of return is 14%.

Last year's residual income was closest to:

Shrewsbury Inc. reported the following results from last year's operations: 20 Sales Variable expenses Contribution margin Fixed expenses Net operating income Average operating assets $7,200, 000 5,400, 000 1,800, 000 1,296,000 $504, 000 $4,000,000 01:25:56 At the beginning of this year, the company has a $800,000 investment opportunity with the following characteristics: Sales Contribution margin ratio Fixed expenses $2,480,000 403 of sales $ 868,000 The company's minimum required rate of return is 14%. Last year's residual income was closest to Multiple Choice $504,000 ($56,000) $460,000 ($475,200)