Compute the residual income for each division.North DivisionWest DivisionSouth Division $130000225000149000 Presented below is selected information for three regional divisions of Medina Company.Contribution marginControllable marginAverage operating assetsMinimum rate of return.North$299,100$140,000$1,000,00013 %DivisionsWest$500,700$360,000$1,500,00015 %South$400,200$208,600$1,490,00010 %

RETURN ON INVESTMENTReturn on investment is one of the profitability ratios which shows how much…

Answered: Compute the residual income for each…

Business

Accounting

Compute the residual income for each division. North Division West Division South Division SA $ 130000 225000 149000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: Presented here is selected information for three regional divisions of Pronghorn Comp Contribution…

A: Return on investment can be calculated based on controllable margin by average operating assets. It…

Q: Required A Required B What are the actual (reported) operating profits in each division for year 1…

A: The operating profit is computed for a segment by deducting the direct costs and allocated costs.…

Q: Wingate Company, a wholesale distributor of electronic equipment, has been experiencing losses for…

A: >Contribution margin Income Statement is Variable costing Income Statement wherein, the Costs are…

Q: Ibsen Company makes two products from a common input. Joint processing costs up to the split-off…

A: ANSWER The formula to calculate Financial advantage (disadvantage ) of processing product beyond the…

Q: The income from operations and the amount of invested assets in each division of Beck Industries are…

A: minimum acceptable return is the minimum profit expected to be earned by a investor on the invested…

Q: The following Information was taken from the segmented Income statement of Restin, Inc., and the…

A: Responsibility accounting is a management control system that assigns responsibility for the costs…

Q: Provide the missing data for the following situations: Red Division White…

A: The ratio analysis helps to analyse the financial statements of the business on the basis of various…

Q: Division A1 were eliminated, NUBD's income wo

A: Fixed cost in cost of goods sold @20% , i.e., 20% * P800,000 P160,000 60% is avoidable. 40% is…

Q: The operating income and the amount of invested assets in each division of Conley Industries are as…

A: Retail Division Commercial Division Internet Division Invested assets 440000 810000 820000 x…

Q: Division A $ 5,000,000 $ 1,000, 000 $ Division B $ 9,000, 000 $ 4, 500, 000 729, 000 Division C $…

A: ROI= Net income/Operating assets Residual income= Net income - (Operating assets x Required return)

Q: discloses supplemental Spein Company segments. The following information is available for 2019:…

Q: Requirement b. What is the current residual income for each division? Begin by selecting the formula…

A: Residual income refers to the total earning left with the company e after accounting for or the cost…

Q: The operating income and the amount of invested assets in each division of Conley Industries are as…

A: Residulal income = Operating income - Desired income where, Desired income = Operating assets x…

Q: AB Division had the following information: Asset base in AB Division Net income in AB Division…

A: Economic Value Added is net operating profit after taxes (or NOPAT) less a capital charge, the…

Q: Haresh

A: a. Economic Value Added (EVA) for the three regions:Region I:Revenue: $1,212,000Cost of Sales:…

Q: Residual Income The income from operations and the amount of invested assets in each division of…

A: Residual income is calculated as excess of income from operations over required rate of return.

Q: evenue 10, 000 Fixed Asset: Purchases by division 500 Purchases by Head Office 2,500 Direct Material…

A: Note:- Since you have posted a question with multiple sub-parts, we will solve the first three…

Q: Division Assets Operating Income Revenue A $6,577 $5,008 $16,346 B $870 $637 $2,465 C $29,878…

A: Capital turnover compares the annual sales of a business to the total amount of its stockholders'…

Q: 1) Company "Y" has two service departments, DA and DB, and two production departments, P1 and P2..…

A: The department costs can be allocated to other departments using various methods as direct method,…

Q: Residual Income The income from operations and the amount of invested assets in each division of…

A: Given: Minimum acceptable return for invested assets =8% In order to determine the residual income…

Q: Hairy 3,000,000 1,250,000 750,000 Fairy 2,500,000 375,000 600,000 Dairy 6,000,000 Lairy 1,000,000…

A: Reportable Segment: The term "reportable section" refers to the International Financial Reporting…

Q: Date Purchased Cost Cost Sales Expenses 174,000 01/Jan $4.70 15,510 34,000 35,340 64,890 3,300…

A: The inventory can be valued using various methods as LIFO, FIFO and weighted average method.

Q: Residual Income The income from operations and the amount of invested assets in each division of…

A: Step 1 The residual income is the buffer income over the minimum income.

Q: Required: 1. Determine the departmental contribution to overhead and the departmental net income for…

Q: The sales, income from operations, and invested assets for each division of Wren Company are as…

A: CALCULATION FOR RESIDUAL INCOME : = INCOME FROM OPERATION - (MINIMUM RATE OF RETURN X INVESTED…

Q: Residual Income The income from operations and the amount of invested assets in each division of…

A: Given that Values of income from operations and invested assets of three divisions.

Q: The operating income and the amount of invested assets in each division of Conley Industries are as…

A: Minimum acceptable operating income = 10% * Assets invested

Q: Using the data below for the Ace Guitar Company: A Region B Region Sales $560,000…

A: Total Support department expenses = $235200+156800 = $392,000 Total sales = $560000+840000 =…

Q: estion 6. Solex Company manufactures three products from a common input in a joint processing…

A: The incremental analysis decision-making technique entails weighing the additional costs and…

Q: The income from operations and the amount of invested assets in each division of Shiner Industries…

A: Formulas, Minimum acceptable income = Invested assets * 12% Residual value = Income from operations…

Q: Selected sales and operating data for three divisions of different structural engineering firms are…

A: Return on investment (ROI) is a statistic used to evaluate an investment's profitability.In excess…

Q: The Cook Corporation has two divisions-East and West The divisions have the following revenues and…

A: Decision Making - It is the process of choosing the best option among available different…

Q: In each of the cases below, assume Division X has a product that can be s customers or to Division Y…

A: Transfer price: Transfer price is the price that one division of a company will pay to another…

Q: • The following are selected data for the division for the consumer products of ABC Corp for 2019:…

A: Sales = 50,000,000 Assets = 20,000,000

Q: 4,500,000 795,000 2,400,000 Division C Division D 6,800,000 795,000 2,700,000 Required: (a) Using…

A: Profit margin is the margin earned on sales of the business. Investment turnover shows ratio of…

Q: Required A Required B Compute residual income for the three regions. Ignore taxes.

A: Divisional income is required to evaluate the performance of a divisional manager. The divisional…

Q: answer provide pleaase

A: To find the total productivity, we'll use the formula:Total Productivity (TP) =Output / Total…

Q: Residual Income The operating income and the amount of invested assets in each division of Otte…

A: Residual income: Residual income is the excess of income over the minimum acceptable return on…

Q: The following are selected data for the division for the consumer products of ABC Corp for 2019:…

A: Residual income for the division = Net income - average invested capital x Cost of capital

Q: Residual Income The income from operations and the amount of invested assets in each division of…

A: Residual income = Income from operations - (Invested assets*Minimum required rate of return)

Q: Required: 1. Calculate the net operating incomes earned by Division A, Division B, and the company…

A: Transfer pricing: > Transfer pricing is associated with the term "arms-length" price.> It…

Q: The following results are available for Division X and Y: Division…

A: Solution:- a)Calculation of Return on capital employed as follows:- Return on capital employed…

Q: None

A: Step 1: a. To compute divisional operating income for the two divisions, we subtract the total…

Q: Vinubhai

A: I answered your question.

Question

Compute the residual income for each division.
North Division
West Division
South Division $
130000
225000
149000

Presented below is selected information for three regional divisions of Medina Company.
Contribution margin
Controllable margin
Average operating assets
Minimum rate of return.
North
$299,100
$140,000
$1,000,000
13 %
Divisions
West
$500,700
$360,000
$1,500,000
15 %
South
$400,200
$208,600
$1,490,000
10 %

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1: Introducing Return on Investment

VIEW

Step 2: Calculate the Residual Income

VIEW

Solution

VIEW

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Please Do not Give image format
The following are selected data for the division for the consumer products of ABC Corp for 2019: Sales 50,000,000 Average invested capital (assets) 20,000,000 Net income 2,000,000 Cost of capital 8% What is the asset turn-over ratio for the division? 0.25 2.5 8 10% Group of answer choices 1 2 3 4
Please do not give solution in image format thanku
The Maxim Corporation reported the following operating results for its three divisions: South, West, and East. West Division $1,700,000 50,000 East Division $2,000,000 $ $ 100,000 $ 625,000 $ 800,000 Sales. After-tax income Divisional assets. Which division has the largest asset turnover? Multiple Choice O South. West. South Division $ 380,000 $ 20,000 $ 200,000 East All three divisions have the same asset turnover.
1 ) Retail Division = ( 1125 / 2500 ) x 264000 = 118800 commercial division = ( 1375 / 2500 ) x 264000 = $ 145200 Using the data for Lee Company above along with the following data, determine the divisional income from operations for the Division and the Commercial Division:
sasvita
2A-C
A4. Continue or discontinue Example 2: B 420 210 210 Division Sales (1000€) Variable cost (1000£) Contribution (1000£) Fixed cost (1000£) Profit/loss (1000£) A 350 280 70 C 150 120 30 Total 920 610 310 262.5 47.5 General fixed overheads are allocated to each division on the basis of sales revenue; 60% of the total fixed costs incurred by the company are specific to each division, being split equally between them. Using relevant cost, determine, which divisions should remain open if Northampton wishes to maximise profits?
sd subject-Accounting
Residual Income The income from operations and the amount of invested assets in each division of Beck Industries are as follows: Income from Operations Invested Assets Retail Division $102,900 Commercial Division 115,000 Internet Division 123,200 Assume that management has established a 8% minimum acceptable return for invested assets. a. Determine the residual income for each division. Income from operations Minimum acceptable of income from operations Residual income b. Which division has the most residual income? Commercial Division 490,000 500,000 770,000 Retail Division Commercial Division $102,900 $115,000 Internet Division $123,200
Your Corporation has two divisions: A Division and B Division. The corporation's net operating income is $31,800. The A Division's divisional segment margin is S111,800 and the B Division's divisional segment margin is $152,800. What is the amount of the common fixed expense not traceable to the individual divisions? O $121,000 O $232,800 O $ 80,000 O $296,400
Question 6. Solex Company manufactures three products from a common input in a joint processing operation. Joint processing costs up to the split-off point total $100,000 per year. The company allocates these costs to the joint products on the basis of their total sales value at the split-off point. These sales values are as follows: product X, $50,000; product Y, $90,000; and product Z, $60,000. Each product may be sold at the split-off point or processed further. Additional processing requires no special facilities. The additional processing costs and the sales value after further processing for each product (on an annual basis) are shown below: Product Additional Processing Costs Sales Value after Further Processing $80,000 $150,000 $75,000 X Y. Z $35,000 $40,000 $12,000 Required: Which product or products should be sold at the split-off point, and which product or products should be processed further? Show computations.