The Northern Division of the Smith Company had average operating assets totaling $150,000 last year. If the minimum required rate of return is 12%, and if last year's net operating income at Northern was $20,000, then the residual income for Northern last year was:
A) $20,000. C) $5,000.
B) $l8,000. D) $2,000.
Please see the attached file.
19. The Northern Division of the Smith Company had average operating assets totaling ...
The answer shows the calculation and the basis for the answer.