Question: Top management is trying to determine which would be the best choice of the following: Data of investment choices: 1 Sales $10,000,000 Operating income 200,000

Top management is trying to determine which would be the best choice of the following:

Data of investment choices:

1

Sales

$10,000,000

Operating income

200,000

Average operating assets

2,000,000

Required: Compute the Return on Investment

Required: Compute the Residual Incomeassuming a minimum required rate of return of 8%.

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