Return On Investment (ROI) and Residual Income
A family friend has asked your help in analyzing the
operations of three anonymous companies operating in the same service sector
industry Supply the missing data in the table below Show the formulas used:
A B C
Net Operating Income $
? $45,000 $ ?
Average Operating Assets $160,000 ? $150,000
Return On Investment (ROI) 20% 18% %
Minimum Required Return Rate
Percentage 15% % ? 12%
Dollar Amount $ ? $50,000 $ ?
Residual Income $
? $ ? $6,000