The Following Information Is Available About the Charger Division of Weston

question 44

Essay

The following information is available about the Charger Division of Weston Company. Weston requires a return of 8% from all divisions.
$\begin{array}{lrr}\text { Charger Division Earnings from Operations } & \$ & 12,854,000 \\\text { Charger Division Sales } & \$ & 92,500,000 \\\text { Charger Division Identifiable Assets } & \$ & 156,000,000\end{array}$

Required:
a. Compute the ROI for the Charger Division.
b. Compute the residual income for the Charger Division.

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Definitions:

Earned Revenue

Income generated from the sale of goods or services related to the core business operations.

Accrued Wages

Wages that have been earned by employees but have not yet been paid by the employer.

Independent Contractor

An individual or entity contracted to perform work for—or provide services to—another entity as a non-employee, thereby offering flexibility and operational advantages for the hiring entity.

Journal Entry

A record in accounting that represents the debit and credit sides of a transaction, reflecting changes in account balances.