Simmons Company is a merchandiser with multiple store locations. One of its store managers is considering a shift in her stores product mix in anticipation of a strengthening economy. Her store would invest $800,000 in more expensive merchandise (an increase in its working capital) with the expectation that it would increase annual sales and variable expenses by $400,000 and $250,000, respectively, for three years. At the end of the three-year period, the store manager believes that the economic surge will subside; therefore, she will release the additional investment in working capital. The store managers pay raises are largely determined by her stores return on investment (ROI), which has exceeded 22% each of the last three years.

Assuming the companys minimum required rate of return is 16%, calculate the residual income earned by the store managers investment opportunity for each of years 1 through 3