Stuart Corporation operates three investment centers. The following financial statements apply to the investment center named Bowman Division. BOWMAN DIVISION Income Statement For the Year Ended December 31, Year 2 Sales revenue Cost of goods sold Gross margin Operating expenses Selling expenses Depreciation expense Operating income Nonoperating item Loss on sale of land Net income $106,580 58,575 48,005 (2,730) (4,035) 41,240 (4,600) $ 36,640 Assets Cash BOWMAN DIVISION Balance Sheet As of December 31, Year 2 Accounts receivable Merchandise inventory Equipment less accumulated depreciation Nonoperating assets Total assets Liabilities Accounts payable Notes payable Stockholders' equity Common stock Retained earnings Total liabilities and stockholder's equity $ 12,652 40,276 36,900 90,318 9,900 $190,046 $ 9,597 62,000 75,000 43,449 $190,046 Required c. Calculate the ROI for Bowman. d. Stuart has a desired ROI of 13 percent. Headquarters has $94,000 of funds to assign to its investment centers. The manager of the Bowman Division has an opportunity to invest the funds at an ROI of 15 percent. The other two divisions have investment opportunities that yield only 14 percent. Calculate the new ROI for Bowman division, if the investment opportunity is adopted by Bowman. e. Based on the original data, calculate the original residual income. Also, calculate the new residual income based on information provided in Requirement d.