Sales CGS Direct Exp. Salaries Insurance Allocated Exp. Utilities Company A $400.000 Expected return 220,000 54.000 3,000 2,000 Total Expenses 59.000 on average assets 12% Company B $800,000 1.200,000 400,000 90,000 6,000 3,000 99,000 10% 1,300,000 Company C $1,600,000 None of the companies have residual income O Company C 960,000 226,000 120,000 Average Assets Based on the above information, which company has the lowest residual income?

Answer rating: 100% (QA)

Residual income is calculated as the net operating income minus a charge for the cost of capital emp... View the full answer