Exercise 11-14 (Static) Evaluating New Investments Using Return on Investment (ROI) and Residual Income (LO11-1, LO11-2] Selected sales and operating data for three divisions of different structural engineering firms are given as follows: Division Division 3 Division Sales $ 12,000,000 $14,000,000 $25,000,000 Average operating assets $ 3,000,000 $ 7,000,000 $5,000,000 Net operating income $ 600,000 $ 560,000 $ 800,000 Minimum required rate of return 145 100 168 Required: 1. Compute the margin, turnover, and return on investment (ROI) for each division 2. Compute the residual income (loss) for each division 3. Assume that each division is presented with an investment opportunity that would yield a 15% rate of return a. If performance is being measured by ROI, which division or divisions will probably accept the opportunity? b. If performance is being measured by residual income, which division or divisions will probably accept the opportunity? Complete this question by entering your answers in the tabs below. D. IT performance is being measured by residual income, wnicn division or DIVISIONS will probably accept the op Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Req Req 3B Compute the margin, turnover, and return on investment (ROI) for each division. (Do not round intermediate calculatic Round your answers to 1 decimal place.) Margin Turnover ROI Division A % % Division B % % Division % Reg Req 2 > & Exit a. It performance is being measured by ROI, which division or divisions will probably accept the opportunity! b. If performance is being measured by residual income, which division or divisions will probably accept the opportunity? Check my Complete this question by entering your answers in the tabs below. Is Reg 1 Book Reg 2 Reg 3A Reg 38 Print Compute the residual income for each division. (Loss amounts should be indicated by a minus sign.) Terences Residual income foss) Division A Division B Division C D. If performance is being measured by residual income, wnicn division or divisions will probably accept the oppo Complete this question by entering your answers in the tabs below. Reg 1 Req 2 Req Req 3B Assume that each division is presented with an investment opportunity that would yield a 15% rate of return. If perform is being measured by ROI, which division or divisions will probably accept the opportunity? Division A Division B Division C Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Req 3A R9 3B Assume that each division is presented with an investment opportunity that would yield a 15% rate of return. If performance is being measured by residual income, which division or divisions will probably accept the opportunity? Division A Division B Division C