Selected data from Chering Division's accounting records revealed the following:
$\begin{array}{lcc}
\text { Sales } & \$ 825,000 \
\text { Average investment } & \$ 440,000 \
\text { Net operating income } & \$ 66,000 \
\text { Minimum rate of return (divisional cost of capital) } & 14 \%
\end{array}$Chering Division's residual income (RI) is:
A)$4,400.
B)$8,800.
C)$9,240.
D)$22,380.
E)$49,500.

Question

Selected data from Chering Division's accounting records revealed the following:
$\begin{array}{lcc}
\text { Sales } & \$ 825,000 \
\text { Average investment } & \$ 440,000 \
\text { Net operating income } & \$  66,000 \
\text { Minimum rate of return (divisional cost of capital) } & 14 \%
\end{array}$Chering Division's residual income (RI) is:
A)$4,400.
B)$8,800.
C)$9,240.
D)$22,380.
E)$49,500.

Quizplus · Accepted Answer

The Answer of Selected data from Chering Division's accounting records revealed the following:
$\begin{array}{lcc}
\text { Sales } & \$ 825,000 \
\text { Average investment } & \$ 440,000 \
\text { Net operating income } & \$  66,000 \
\text { Minimum rate of return (divisional cost of capital) } & 14 \%
\end{array}$Chering Division's residual income (RI) is:
A)$4,400.
B)$8,800.
C)$9,240.
D)$22,380.
E)$49,500.

Selected Data from Chering Division's Accounting Records Revealed the Following