es Adams Cough Drops operates two divisions. The following information pertains to each division for the year. Division A Division B $201,000 Sales $78,000 Operating income $ 16,300 $ 9,600 Average operating assets $ 59,000 Company's desired rate of return $40,000 178 178 Required a. Compute each division's residual income. b. Which division increased the company's profitability more? a. Division A Division B b. The division that increased the company's profitability more is Residual Income