xercise $9-10$A $($Algo$)$ Residual income LO $9-3$

Solomon Cough Drops operates two divisions. The following information pertains to each division for Year $1.$

$$Division ADivision BSales$ $217,000$$ $92,000$Operating income$ $16,500$$ $9,600$Average operating assets$ $62,000$$ $35,000$Company's desired rate of return$12\%12\%$

Required

Compute each division$$s residual income.

Which division increased the company$$s profitability more?