Precious Metals Pty Ltd Earned Residual Income of $70 000

Multiple Choice

Precious Metals Pty Ltd earned residual income of $70 000 during the year. The net profit was $250 000 during the year and the required return was 15 per cent. What was the invested capital?

A) $1 200 000
B) $1 500 000
C) $1 400 000
D) $1 300 000