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The following data relate to the Happy Division of Euphoria, Inc.: Sales .......................................................................................................................... $10,000,000 Variable costs ............................................................................................................. 3,000,000 Direct xed costs ........................................................................................................ 5,000,000 Invested capital
The following data relate to the Happy Division of Euphoria, Inc.: Sales .......................................................................................................................... $10,000,000 Variable costs ............................................................................................................. 3,000,000 Direct xed costs ........................................................................................................ 5,000,000 Invested capital .................. 2,000,000 Capital charge .................................................. 12 % The divisional residual income is: A. $7,000,000 B. $240,000 C. $2,000,000 D. $1,760,000 E. none of the above
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