The Auto Division of Fran Corporation Has $2

Multiple Choice

The Auto Division of Fran Corporation has $2.5 million in total assets and $200,000 in liabilities, while the Transportation Division has $5 million in total assets and $3 million in liabilities.What are the imputed costs of the Auto division and of the Transportation division, respectively, if the corporation has a required rate of return of 11%?

A) $275,000 and $550,000
B) $253,000 and $330,000
C) $297,000 and $880,000
D) $275,000 and $330,000
E) $200,000 and $3,000,000