=+A14-3 Evaluating divisional performance The three divisions ofMonster Foods are Snack Goods, Cereal, and Frozen Foods. The divisions are structured as investment centers. The following responsibility reports were prepared for the three divisions for the prior year:

Snack Goods Cereal Frozen Foods Revenues $1,050,000 $2,450,000 $ 875,000 Operating expenses 420,000 1,400,000 175,000 Income from operations before service department charges $ 630,000 $1,050,000 $ 700,000 Service department charges:

Promotion $ 175,000 $ 350,000 $ 308,000 Legal 87,500 70,000 140,000

$ 262,500 $ 420,000 $ 448,000 Income from operations $ 367,500 $ 630,000 $ 252,000 Invested assets $2,100,000 $4,200,000 $1,260,000