Crimpy Company Has Total Assets of $900,000, a 10% Target

Multiple Choice

Crimpy Company has total assets of $900,000, a 10% target rate of return, and a residual income of ($4,500) . Which of the following statements is correct?

A) Crimpy's return on investment can't be determined given the information provided.
B) Crimpy's operating income was $85,500.
C) Crimpy's residual income would decrease $9,000 if the target rate of return was reduced to 9%.
D) Crimpy's return on investment will increase when the target rate of return decreases.