July 19th, 2019
The Tuxedo Division of Shamus OToole Company had operating income last year of $152,250,000 and average operating assets of $2,175,000,000. OTooles minimum acceptable rate of return is 8%. (Note: Round all answers to two decimal places.)
Required: 1. Calculate the residual income for the Tuxedo Division. 2. Was the ROI for the Tuxedo Division greater than, less than, or equal to 8%?