Solomon Home Maintenance Company earned operating income of $6,865,500 on operating assets of $59,700,000 during Year 2. The Tree Cutting Division earned $1,198,290 on operating assets of $6,770,000. Solomon has offered the Tree Cutting Division $2,060,000 of additional operating assets. The manager of the Tree Cutting Division believes he could use the additional assets to generate operating income amounting to $407,880. Solomon has a desired return on investment (ROI) of 9.50 percent. Required

Calculate the return on investment for Solomon, the Tree Cutting Division, and the additional investment opportunity.

1. 	Return on Investment
   Solomon Home Maintenance Company		%
   Tree Cutting Division		%
   Additional investment opportunity		%

2. Calculate the residual income for Solomon, the Tree Cutting Division, and the additional investment opportunity.

   	Residual Income
   Solomon Home Maintenance Company
   Tree Cutting Division
   Additional investment opportunity