King Corphas Revenues of $1,500,000 Resulting in an Operating Income of of $105,000.Average

Multiple Choice

King Corp.has revenues of $1,500,000 resulting in an operating income of $105,000.Average invested assets total $750,000,and the hurdle rate is 6%.Calculate the residual income if sales increase by 10% and the profit margin and invested assets remain constant.

A) $115,500
B) $45,000
C) $0
D) $70,500