Joseph Company reported the following information for the current year: The company's operating income was:
A) $94,440.
B) $56,250.
C) $45,000.
D) $33,750.

Name: Joseph Company reported the following information for the current year: The company's operating income was: A) $94,440. B) $56,250. C) $45,000. D) $33,750.
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Question

Joseph Company reported the following information for the current year:  The company's operating income was:
A) $94,440. 
B) $56,250. 
C) $45,000. 
D) $33,750.

Quizplus · Accepted Answer

Residual income = Operating income − (Operating assets × Desired ROI)
$11,250 = Operating income − ($375,000 × 12%)
Operating income = $11,250 + $45,000 = $56,250

Joseph Company Reported the Following Information for the Current Year