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The Very Best Products Division, of Just-So-So Company had operating income of $9,400,000 and operating assets of $46,200,000 during the current year. The Very Best
The Very Best Products Division, of Just-So-So Company had operating income of $9,400,000 and operating assets of $46,200,000 during the current year. The Very Best Products Division has developed a potential new product that would require $9,900,000 in operating assets and would be expected to provide $2,800,000 in operating income each year. Just-So-So has set a target return on investment (ROI) of 20% for each of its divisions. Assuming that the new product is put into production, calculate the residual income for the division. Multiple Choice O $1,820,000 O $780,000 O $940,000 O $980,000
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