Question: the only current answer is letter b please help! ROI and Residual Income: Impact of a New Investment The Stallion Division of Motortown Motors had
the only current answer is letter b
please help!

ROI and Residual Income: Impact of a New Investment The Stallion Division of Motortown Motors had an operating income of $675,000 and net assets of $2,700,000. Motortown Motors has a target rate of return of 23 percent. (a) Compute the return on investment. (Round your answer to three decimal places.) 25 X (b) Compute the residual income. 39 54,000 V (c) The Stallion Division has an opportunity to increase operating income by $100,000 with an $675,000 investment in assets. 1. Compute the Stallion Division's return on investment ifthe project is undertaken. [Round your answer to three decimal places.) 38.272 3' 2. Compute the Stallion Division's residual income if the project is undertaken. Use a negative Sign with your answer results in a residual loss. 5: 309,205 X
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