H1.Account SalesOperating IncomeOperating AssetsReturn on InvestmentRequired rate of returnResidual IncomeProductionVariable CostsFixed OverheadDivision A$60.0004.50030,00015%10%1.500Division A manufactures batteries that it sells primarily to Division B. Half the batteriesmanufactured by Division A were sold to outside companies at a price of $2 each. The remainingbatteries were transferred to Division B. The cost data are given below.Variable Selling ExpensesFixed Administrative ExpensesWhat should the transfer price be if the company uses:SalesOperating IncomeOperating AssetsMinimum rate of returi10%Division B$75,00025.000Market PriceVariable CostConsider the following data for three divisions of a conglomerate:Division A Division B Division C$140,000 $180,000 $250,0005,000 63,000 14,40020,00035,00090,00019%20%ABC250.00010%8%5,000120,000 units$120,000$60,000$30,000$20,000Calculate the residual income for each division.Division C$100.00010.000$50,00020%20%0Each division is provided with an investment opportunity that could produce a 20% ROI. Which division wnot accept the investment?X

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Sales Operating Income Operating Assets Return on Investment Required rate of return Residual Income Production Variable Costs Fixed Overhead Division A $60.000 4.500 30,000 15% 10% 1.500 Market Price Variable Cost ‒‒‒‒‒‒‒ Division A manufactures batteries that it sells primarily to Division B. Half the batteries manufactured by Division A were sold to outside companies at a price of $2 each. The remaining batteries were transferred to Division B. The cost data are given below. Variable Selling Expenses Fixed Administrative Expenses What should the transfer price be if the company uses: Division B $75,000 25.000 250.000 10% 8% 5,000 120,000 units $120,000 $60,000 $30,000 $20,000 Division C $100.000 10.000 $50,000 20% 20% 0