Thomas Railroad Company organizes its three divisions. the North (N), South (S), and West (W) regians, as orofit centers. The chief executive officer (CEO) evaluates divisional performance, using income from operations as a percent of revenues. The following quarterly income and expense accounts wera provided from the trial balance as of December 31: Revenues-N Region $965,900 Revenues-S Region 1,120,400 Revenues-W Region 2.038.400 Operating Expenses-N Region 612.100 Operating Expenses-S Region 666.800 Operating Expenses-W Region 1,232,700 Corporate Expenses-Dispatching 557,500 Corporate Expenses-Equipment Management 149.600 Corporate Expenses Treasurer's 146,900 General Corporate Officers' Salaries 324,400 The company operates three service departments: the Dispatching Department, the Equipment Management Departmant, and the Treasurer's Department. The Dispatching Department manages the scheduling and releasing of completed trains. The Equipment Mansgement Department manages the railroad cars inventories. Tt makes sure the right freight cars are at the right placa at the right time. The Treasurer's Department conducts a variety of services for the company as a whole. The following sdditional information has been gathered South North West 6,700 10.000 Number of schadulad trains 5.600 1.100 900 1.400 Number ofrairoad cars in inventory Requireda Dispatching Equipment Management Total service department charges Income from operations Feadtacs r Check My Won 1. Determine the dispatching rate per train by dividing service cost by output. For each division's dispatching cost, multiply the dispatdhing rate by the number of scheduled trains Repeat this process for the other service department charges. Subtract the service department charges for a division from that division's income from operstions before such charges Learning Objecive 3 2. What is the orofit margin of each division? Round to one decimal place. Profit Margin Region North Region South Region West Region 9% Identify the most successful region according to the profit margin. 3. What would you include in a recommendation to the CEC for a better method for evaluating the performance of the divisions? a. The method used to evaluate the performance of the divisions should be reevaluated. b. A better divisional performance measure would be the rate of return on investment (income from operations divided by divigional assets). A better divisional performance measure would be the residual income (income from operations less a minimal return on divisional assets). d. None of these choices would be included. e. All of these choices (a. b & c) would be included