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Home Q & A Board Other Fields Homework Help Business Accounting
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biokam biokam
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1 months ago
People's Construction Company has set a 15% required minimum rate of return. The company's CFO is considering investing in a $125,000 crane that is expected to generate $25,000 in additional operating income. What is the crane's residual income?

▸ $18,750

▸ $4,500

▸ $15,000

▸ $6,250
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Managerial Accounting

Managerial Accounting


Edition: 4th
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collegestudent1collegestudent1
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$6,250

Operating income - (average assets × required minimum rate of return) = $25,000 - ($125,000 × 15%) = $6,250
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biokam Author
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1 months ago
You make an excellent tutor!
paulinaibarra98
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Yesterday
Thanks for your help!!
carston
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2 hours ago
Good timing, thanks!
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