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[ The following information applies to the questions displayed below. ] A manufacturer reports the following for two of its divisions for a recent month.

[The following information applies to the questions displayed below.]
A manufacturer reports the following for two of its divisions for a recent month.
Beverage Division Cheese Division
Average assets $ 5,000 $ 10,000
Sales 3,0005,000
Income 600800
Assume that each of the companys divisions has a target income at 7% of average assets. Compute residual income for each division.

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