The manager of Synergy Company's Stock Division projects the following for next year:

Sales

S$195,000$

Operating income

$70,000$

Operating assets

$385,000$

The manager can invest in an additional project that would require $$50,000$ investment in additional assets and would generate $$9,000$ of additional income. The company's minimum rate of return is $15\%.$ What is the residual income for the Stock Division with the additional project?

$$40,000$

S$6,000$

S$13,750$

$$4,200$

$$25,600$

The manager of Synergy Company's Stock Division projects the following for next year:

Sales

S$195,000$

Operating income

$70,000$

Operating assets

$385,000$

The manager can invest in an additional project that would require $$50,000$ investment in additional assets and would generate $$9,000$ of additional income. The company's minimum rate of return is $15\%.$ What is the residual income for the Stock Division with the additional project?

$$40,000$

S$6,000$

S$13,750$

$$4,200$

$$25,600$