Edinger Industries Is a Division of a Major Corporation Required:
What Is the Division's Residual Income

Essay

Edinger Industries is a division of a major corporation. The following data are for the latest year of operations:
$$\begin{array}{l}\text { Sales } & \$ 20,760,000 \\\text { Net operating income } & \$ 2,553,480 \\\text { Average operating assets } & \$ 6,000,000\\\text { The compary's minirnum required rate of retum }&16\%\end{array}$$
Required:
What is the division's residual income?