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StormLrd StormLrd
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6 years ago
Stratton Industries has two divisions. These divisions reported the following results for the year just ended:
   Division 1   Division 2
Operating Income   $840,000   $180,000
Assets   $4,200,000   $750,000

Required:
a.   Calculate the ROI for each division. Which division would you consider to be the most successful? Why?
b.   Now assume that the company requires a 14% minimum rate of return. Calculate the residual income for each division. Which division would you consider to be the most successful? Why?
Textbook 
Cost Accounting: A Managerial Emphasis, Canadian Edition

Cost Accounting: A Managerial Emphasis, Canadian Edition


Edition: 7th
Authors:
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pachopacho
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6 years ago
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-Michigan State University

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StormLrd Author
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6 years ago
Just got PERFECT on my quiz
Natalie Price
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Yesterday
Smart ... Thanks!
aricketts6@
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2 hours ago
Good timing, thanks!
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