The income from operations and the amount of invested assets in each division of Devon Industries are as follows:

Income from Operations Invested Assets Sporting Goods Division$104,500550,000Health Care Division 52,500250,000Commercial Division 112,000800,000 Assume that management has established a 10% minimum acceptable rate of return for invested assets.

a.Determine the residual income for each division.

Sporting Goods Division Health Care Division Commercial Division Income from operations$104,500$52,500$112,000 Minimum amount of income from operationsResidual income