The Litton Company has established standards as follows: Direct material: 3 pounds per unit @ $4 per pound = $12 per unit Direct labor 2 hours per unit $8 per hour = $16 per unit Variable manufacturing overhead: 2 hours per unit @ 55 per hour = $10 per unit Actual production figures for the past year are given below. The company records the materials price variance when materials are purchased. The company applies variable manufacturing overhead to products on the basis of standard direct labor-hours. The labor efficiency variance is:10. Residual income is a better measure for performance evaluation of an investment center manager than return on investment because: the problems associated with measuring the asset base are eliminated. desirable investment decisions will not be rejected by divisions that already have a high ROI. only the gross book value of assets needs to be calculated. returns do not increase as assets are depreciated. Which of the following is no