What is answer for question 1 2 3 4?

PROBLEM 11-17 Return on Investment and Residual Income ILO3, LO4 Faced with headquarters desire to add a new product line. Stefan Grenier, mana Products' East Division, felt that he had to see the numbers before he made a move, Hia sion's ROl has led the company for three years, and he doesn't want any letdown. er of Bilti divi- autonomous divisions. The divisions hawe Bilti Products is a decentralized wholesaler with four are evaluated on the basis of ROL with year-end bonuses given to divisional managers who the highest ROL. Operating results for the company's East Division for last year ar Sales Variable expenses... Contribution margin. Fixed expenses Operating income. Divisional operating assets 13,400000 7600,000 1680,000 $ 5,250,000 The company had an overall ROI of 18% last year (considering all divisions). The new product line that headquarters wants Grenier's East Division to add would require an investment of $3000.000. The cost and revenue characteristics of the new product line per year would be as follows Sales Variable expenses Fixed expenses $9,000000 65% of sales $2,520000 equired 1. Compute the East Division's ROI for last year: also compute the ROl as it wo the new product line were added. 2. If would appear if you were in Grenier's position. would you accept or reject the new product Why do you suppose headquarters is anxious for the East Division to add the 3. ne to add the new prod 4. Suppose that the company's minimum required rate of return on op and that performance is evaluated using residual income. s 15%