The corporate office is giving the managers of each channel the option of a customer relationship management system that will allow the managers to gather data about their customers and be more effective in their marketing efforts. The system will cost $520,000 and is expected to generate $61,100 in additional annual segment margin.

Calculate the residual income of each distribution channel assuming it purchases the new customer relationship management system.(If the residual income is a loss then enter with a negative sign preceding the number, e.g. -5,125 or parenthesis, e.g. (5,125).)

Residual Income

Retail$______

Online$_____

Catalog_____

Exerclse 10-15 Crane Decor sells home decor items through three dlstributjon channelsretall stars, the Internet, and catalog sales. Each dlstribution channel is evaluated as an Investment center. Selected results from the latest year are as follows: Relall Shores Internet Caulog Sales Sales revenue $12,012,000 $2,710,000 $3,632,000 Varlable expenses 4,316,000 1,332,000 2,161,000 Direct xed expenm 5,232,000 1,191,000 993,000 Avemge assets 5,523,000 2,140,000 2,910,000 Required rate of return 10% 10% 10% Your answer is correct. Calculate the current residual income for each distrlhution channel. (11' the residual Inmme Is a loss then enter with a negative sign preceding the number, e._g. 6,125 or parenthesis, e.g. (5,125).) Residual Income '1 4.03300 a..." $- Online 182000 We, .- (xiE