The Merton Corporation manufactures and sells jeans. Assuming no changes in beginning and ending inventory, the production and sales data for 2019 are as follows: $400,000 600,000 $1,000,000 Current assets Long-term assets Total assets Market value of invested capital $1,200,000 Production output of 2019 Targeted net income Total fixed costs Total variable cost Income tax rate 500,000 Pair of jeans $300,000 $600,000 Per year $14 Per pair of jeans 40% Required: a. Compute the minimum selling price per pair of jeans necessary to achieve the targeted net income. (4 marks) b. Using the selling price from section a above, compute the ROI with separate the ROI (based on operating income) into its two components using the DuPont method. (4 marks) c. Compute the Residual Income (RI) of the corporation for year of 2019, using the selling price from section a above. Merton uses a required rate of return of 14% on total assets when computing Residual Income. (4 marks) d. Assume that the cost of capital is 14%, compute the Economic Value Added (EVA) for Merton using the operating income from section a above. (4 marks) e. Assume you are the manager of Merton and receive 3% of the RI of Merton as your bonus. Compute your bonus, What would you prefer, a flat bonus of $12,000 or the current bonus scheme based on RI? Explain. (4 marks)