Westerville Company reported the following results from last years operations:

Sales	$ 1,400,000
Variable expenses	720,000
Contribution margin	680,000
Fixed expenses	470,000
Net operating income	$ 210,000
Average operating assets	$ 875,000

At the beginning of this year, the company has a $350,000 investment opportunity with the following cost and revenue characteristics:

Sales	$ 560,000
Contribution margin ratio	70	% of sales
Fixed expenses	$ 336,000

The companys minimum required rate of return is 15%.

14. If Westervilles chief executive officer will earn a bonus only if her residual income from this year exceeds her residual income from last year, would she pursue the investment opportunity?

multiple choice

Yes

No