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Jordan Company has two divisions, which reported the following results for the most recent year.   Division I Division II Income ₱ 02,700,000 ₱ 00,600,000 Average invested capital ₱ 18,000,000 ₱ 03,000,000 ROI 15% 20% Imputed interest rate = 10% Under residual income, which division is considered to have a better performance? Show solution Group of answer choices Neither Division I nor II Cannot be determined Division I Division II

Jordan Company has two divisions, which reported the following results for the most recent year.   Division I Division II Income ₱ 02,700,000 ₱ 00,600,000 Average invested capital ₱ 18,000,000 ₱ 03,000,000 ROI 15% 20% Imputed interest rate = 10% Under residual income, which division is considered to have a better performance? Show solution Group of answer choices Neither Division I nor II Cannot be determined Division I Division II

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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7. 

Jordan Company has two divisions, which reported the following results for the most recent year.

 

Division I

Division II

Income

₱ 02,700,000

₱ 00,600,000

Average invested capital

₱ 18,000,000

₱ 03,000,000

ROI

15%

20%

Imputed interest rate = 10%

Under residual income, which division is considered to have a better performance? Show solution

Group of answer choices

Neither Division I nor II

Cannot be determined

Division I

Division II

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