Tvrtko Ltd. of Wonderland has two divisions, one in Toka and one in Loka. Selected data on the two divisions follow: Division Toka Loka Sales $7,000,000 13,000,000 Operating income 430,000 2.300,000 4,000,000 Average operating assets 9,000,000 Required: 1. Compute the ROI for each division. (8 marks) 2. Assume that the company evaluates performance using residual income and that the minimum required rate of return for any division is 16%. Compute the residual income for each division. (8 marks) 6 2. Is the Loka Division's greater residual income an indication that it is better managed? (4 marks)