The following selected data pertain to the Argent Division for last year: Sales............... $1,000,000 Variable costs............ $624,000

Question:

The following selected data pertain to the Argent Division for last year:
Sales............... $1,000,000
Variable costs............ $624,000
Traceable fixed costs......... $100,000
Average invested capital..... . $1,500,000
Imputed interest rate........ . 15%
Required:
1. How much is the residual income?
2. How much is the return on investment? (Rounded to four significant digits.)