Lasky Manufacturing has two divisions: Carolinas and Northeast. Lasky has a cost of capital of 7.5 percent. Selected financial information (in thousands of dollars) for the first year of business follows:

^a R&D is assumed to benefit two periods. All R&D is spent at the beginning of the year.

Required

Evaluate the performance of the two divisions assuming Lasky uses return on investment (ROI).  

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Sales revenue.. Income.... Divisional assets (beginning of year) Current liabilities (beginning of year). R&D expendituresª.. Carolinas $ 800 160 1,000 160 400 Northeast $4,000 312 1,500 160 320