Westerville Company reported the following results from last year's operations: Sales Variable expenses Contribution margin Fixed expenses Net operating income Average operating assets $1,800,000 740,000 1,060,000 700,000 $ 360,000 $ 1,200,000 At the beginning of this year, the company has a $400,000 investment opportunity with the following cost and revenue characteristics: Sales Contribution margin ratio Fixed expenses $ 600,000 60 S 288,000 of sales The company's minimum required rate of return is 10%. 10-a. If Westerville's chief executive officer will earn a bonus only if her ROI from this year exceeds her ROI from last year, would she pursue the investment opportunity? Yes No 10-b. Would the owners of the company want her to pursue the investment opportunity? Yes No Westerville Company reported the following results from last year's operations: Sales Variable expenses Contribution margin Pixed expenses Net operating income Average operating asseto $ 1,800,000 740,000 1,060,000 700,000 $ 360,000 $ 1,200,000 At the beginning of this year, the company has a $400,000 investment opportunity with the following cost and revenue characteristics: Sales Contribution margin ratio Fixed expenses $ 600,000 60 $ 288,000 of sales The company's minimum required rate of return is 10%. Foundational 11-11 11. What is last year's residual income? Residual income Westerville Company reported the following results from last year's operations: Sales Variable expenses Contribution margin Fixed expenses Net operating income Average operating assets $ 1,800,000 740,000 1,060,000 700,000 360,000 $ 1,200,000 At the beginning of this year, the company has a $400,000 investment opportunity with the following cost and revenue characteristics: Sales Contribution margin ratio Fixed expenses $ 600,000 60 of sales $ 280,000 The company's minimum required rate of return is 10%. 12. What is the residual income of this year's investment opportunity? Residual income