JEY-3424 Inc. reported the following data for last year:

JEY-3424 Inc. Balance Sheet
	Beginning Balance	Ending Balance
Assets
Cash	$ 136,000	$ 130,000
Accounts receivable	339,000	482,000
Inventory	567,000	473,000
Plant and equipment, net	808,000	805,000
Investment in Tesla Inc.	403,000	427,000
Land (undeveloped)	245,000	246,000
Total assets	$ 2,498,000	$ 2,563,000
Liabilities and Stockholders' Equity
Accounts payable	$ 379,000	$ 340,000
Long-term debt	1,025,000	1,025,000
Stockholders' equity	1,094,000	1,198,000
Total liabilities and stockholders' equity	$ 2,498,000	$ 2,563,000

JEY-3424 Inc. Income Statement
Sales		$ 5,049,000
Operating expenses		4,392,630
Net operating income		656,370
Interest and taxes:
Interest expense	$ 120,000
Tax expense	192,000	312,000
Net income		$ 344,370

JEY-3424 Inc. paid dividends of $240,370 last year. The “Investment in Tesla Inc.” item on the balance sheet represents an investment in the stock of another company. The company's minimum required rate of return is 15%.

What was the company’s residual income last year?

Answer rating: 100% (QA)

Residual income is calculated as the net income minus the equity charge ... View the full answer