Determining missing items in return on investment and residual income computations

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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Determining missing items in return on investment and residual income computations

The following table presents various rates of return on investment and residual incomes:



Invested
Assets

Operating
Income

Return on
Investment

Minimum
Rate of
Return
Minimum
Acceptable
Operating
Income


Residual
Income
$980,000   $215,600   (a)   12%   (b)   (c)  
520,000   (d)   (e)   (f)   $62,400   $20,800  
320,000   (g)   14%   (h)   35,200   (i)  
240,000   50,400   (j)   12%   (k)   (l)  

Determine the missing items, identifying each item by the appropriate letter.

Round dollar amounts to the nearest whole number.

  Answer
a. fill in the blank 1 %
b. $fill in the blank 2  
c. $fill in the blank 3  
d. $fill in the blank 4  
e. fill in the blank 5 %
f. fill in the blank 6 %
g. $fill in the blank 7  
h. fill in the blank 8 %
i. $fill in the blank 9  
j. fill in the blank 10 %
k. $fill in the blank 11  
l. $fill in the blank 12  
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