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Vernon Home Maintenance Company earned operating income of $5,990,000 on operating assets of $59,900,000 during Year 2. The Tree Cutting Division earned $1,126,330 on operating

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Vernon Home Maintenance Company earned operating income of $5,990,000 on operating assets of $59,900,000 during Year 2. The Tree Cutting Division earned $1,126,330 on operating assets of $6,910,000. Vernon has offered the Tree Cutting Division $2,160,000 of additional operating assets. The manager of the Tree Cutting Division believes he could use the additional assets to generate operating income amounting to $412,560. Vernon has a desired return on investment (ROI) of 8.00 percent. Required a. Calculate the return on investment for Vernon, the Tree Cutting Division, and the additional investment opportunity. b. Calculate the residual income for Vernon, the Tree Cutting Division, and the additional investment opportunity. Required A Required B Calculate the return on investment for Vernon, the Tree Cutting Division, and the additional investment opportunity. (Round your answers to 2 decimal places. (i.e., 0.2345 should be entered as 23.45).) Return on Investment % Vernon Home Maintenance Company Tree Cutting Division Additional investment opportunity % % Required A Required B Calculate the residual income for Vernon, the Tree Cutting Division, and the additional investment opportunity. Residual Income Vernon Home Maintenance Company Tree Cutting Division Additional investment opportunity

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