Care Inc, Has Two Divisions That Operate Independently of One Another

Multiple Choice

Care Inc., has two divisions that operate independently of one another. The financial data for the year 2015 reported the following results:

The company's desired rate of return is 10%. Income is defined as operating income.
What are the respective residual incomes for the North and South Divisions?

A) $60,000 and $100,000
B) $300,000 and $60,000
C) $300,000 and $100,000
D) $500,000 and $700,000