The balance sheet for the New Products Division of NuBone Corporation showed invested assets of $200,000 at the beginning of the year and $300,000 at the end of the year. During the year, the divisions operating income was $12,500 on sales of $500,000.

Instructions

Compute the divisions residual income if the desired ROI is 6 percent.

2. Compute the following performance measures for the division: (a) profit margin, (b) asset turnover, and (c) return on investment.