Accounting 285 Team Exercise #8 Chapter 12 Selected sales and operating data for three divisions of a company are provided below: | Sales Average Operating Assets Net Operating Income Minimum Required Rate of Return Red Division $6,000,000 $1,500,000 $300,000 15% Blue Division $10,000,000 $5,000,000 $900,000 18% Green Division $8,000,000 $2,000,000 $180,000 12% 1 What is the ROI of each division? 2) What is the residual income for each division? 3) Assume that each division is presented with an investment opportunity that would yield a rate of return of 17%. a. If performance is being measured by ROI, which division or divisions will probably accept the opportunity? Reject? Why? b. If performance is being measured by residual income, which division or divisions will probably accept the opportunity? Reject? Why