Answered: The Commercial Division of Galena…

The Commercial Division of Galena Company has operating income of $40,820 and assets of $162,000. The minimum acceptable return on assets is 7%. What is the residual income for the division?

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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Question

The Commercial Division of Galena Company has
operating income of $40,820 and assets of $162,000.
The minimum acceptable return on assets is 7%.
What is the residual income for the division?

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