Guardian Corporation has two major divisions- Healthcare Products and Pharmaceutical Products.It provides the following information for the year. $$\begin{array} { | l | r | r | }
\hline & \text { Healthcare Division } & \begin{array} { c }
\text { Pharmaceutical } \
\text { Division }
\end{array} \
\hline \text { Net sales } & \$ 150,000 & \$ 1,000,000 \
\hline \text { Operating income } & \$ 47,000 & \$ 218,400 \
\hline \text { Average assets } & \$ 310,000 & \$ 5,660,000 \
\hline \text { Target rate of return } & 13.0 \% & 13.0 \% \
\hline
\end{array}$$ Calculate the residual income for the Healthcare Division.

Question

Guardian Corporation has two major divisions- Healthcare Products and Pharmaceutical Products.It provides the following information for the year. $$\begin{array} { | l | r | r | } 
\hline & \text { Healthcare Division } & \begin{array} { c } 
\text { Pharmaceutical } \
\text { Division }
\end{array} \
\hline \text { Net sales } & \$ 150,000 & \$ 1,000,000 \
\hline \text { Operating income } & \$ 47,000 & \$ 218,400 \
\hline \text { Average assets } & \$ 310,000 & \$ 5,660,000 \
\hline \text { Target rate of return } & 13.0 \% & 13.0 \% \
\hline
\end{array}$$ Calculate the residual income for the Healthcare Division.

Quizplus · Accepted Answer

The Answer of Guardian Corporation has two major divisions- Healthcare Products and Pharmaceutical Products.It provides the following information for the year. $$\begin{array} { | l | r | r | } 
\hline & \text { Healthcare Division } & \begin{array} { c } 
\text { Pharmaceutical } \
\text { Division }
\end{array} \
\hline \text { Net sales } & \$ 150,000 & \$ 1,000,000 \
\hline \text { Operating income } & \$ 47,000 & \$ 218,400 \
\hline \text { Average assets } & \$ 310,000 & \$ 5,660,000 \
\hline \text { Target rate of return } & 13.0 \% & 13.0 \% \
\hline
\end{array}$$ Calculate the residual income for the Healthcare Division.

Guardian Corporation Has Two Major Divisions- Healthcare Products and Pharmaceutical