Based on the data in Exercise assume that management has established an 8% minimum acceptable rate of return for invested assets.
In Exercise, The income from operations and the amount of invested assets in each division of Steele Industries are as follows:

a. Determine the residual income for each division.
b. Which division has the most residualincome?

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Retail Division Commercial Division Internet Division Income from Operations $130,000 72,000 137,500 Invested Assets $650,000 400,000 550,000