Which of the following is a problem with residual income?

a. It is not well suited to evaluating the relative performance of two or more divisions.

b. It does not take into account the value of the assets used to generate income.

c. A division with a much larger dollar amount of assets is likely to have a higher residual income than a division with a smaller dollar amount of assets.

4. All of the above.
5. a and c only.