Accounting 26th Edition by Carl Warren,James Reeve,Jonathan Duchac

Exercise 37

A Residual Income
The Consumer Division of Hernandez Company has income from operations of $90,000 and assets of $450,000. The minimum acceptable rate of return on assets is 10%. What is the residual income for the division
B Residual income
The Commercial Division of Herring Company has income from operations of $420,000 and assets of $910,000. The minimum acceptable rate of return on assets is 8%. What is the residual income for the division