Information for Tube division is as follows:
$$\begin{array} { l r }
\text { Net earnings for division } & \$ 20,000 \
\text { Asset base for division } & \$ 50,000 \
\text { Target rate of return } & 16 \% \
\text { Operating income margin } & 12 \% \
\text { Weighted average cost of capital } & 8 \%
\end{array}$$ What is Tube's residual income?

Question

Information for Tube division is as follows:
$$\begin{array} { l r } 
\text { Net earnings for division } & \$ 20,000 \
\text { Asset base for division } & \$ 50,000 \
\text { Target rate of return } & 16 \% \
\text { Operating income margin } & 12 \% \
\text { Weighted average cost of capital } & 8 \%
\end{array}$$ What is Tube's residual income?

Quizplus · Accepted Answer

The Answer of Information for Tube division is as follows:
$$\begin{array} { l r } 
\text { Net earnings for division } & \$ 20,000 \
\text { Asset base for division } & \$ 50,000 \
\text { Target rate of return } & 16 \% \
\text { Operating income margin } & 12 \% \
\text { Weighted average cost of capital } & 8 \%
\end{array}$$ What is Tube's residual income?

Information for Tube Division Is as Follows What Is Tube's Residual Income? A) $13,000 B) $ 8,000

Information for Tube Division Is as Follows What Is Tube's Residual Income?
A) $13,000
B) $ 8,000