When using residual income as a project-screening tool,management should accept a project if the residual income is:
A) positive.
B) negative.
C) equals the ROI.
D) greater than net income.

Question

Quizplus · Accepted Answer

When the manager's evaluation is based on residual income,the manager is likely to accept the funds when the additional investment increases the residual income generated by the investment (that is,when the residual income is positive).

When Using Residual Income as a Project-Screening Tool,management Should Accept