The Victorian Division of WDY Reported Net Profit of $2,500

Multiple Choice

The Victorian Division of WDY reported net profit of $2,500, operating profit of $4,000, average equity of $24,000, and average operating assets of $30,000 in a recent accounting period. If Victoria's required rate of return is 12%, its residual income was

A) $380
B) $(380)
C) $400
D) $1,100