Question 1]] {5 points} Honolulu Enterprises has two decutralized divisions (Coconut and Guava) that have decision making responsibili over the amount of resources invested in their divisions. Recent nancial ex is for both divisions are presented below: Coconut Guava Fixed assets, gross $ 4,500 $ use Aocrmurlated depreciation $ EJEIU $ Lli} l[litherasseis $ sou $ 1,351} Liabilities $ 9'00 5 LEW Sales $12,150 $12,951} Netincomeaftertax" 5 1,330 5 Lsre Average age of xed assets (years) 15 5 "Net income is after tax but before interest Honolulu's weighted average cost of capital {WAGE} is 15% and the company' uses residual income as a method to evaluate performance. 1Which of the following statements is correct? Please support your answer with calculations to receive full credit. A. Coconut's RID] will be raised by divesting of a project with a 20% EDI but its R] will be lower. B. Coconut's R1 will decrease by taking on a project with a $12 cost and net income before interest of 53. C. Guava's R] will increase by taking on a project with an $3 cost and net income before interest of $1.1. D. Coconut's R1 is less than Guava's R1. E. None of the choices are correct