The Following Information Is Available for Aggie Auto Sales How Much Is Aggie Auto's Residual Income?
A)$125,000
B)$640,000
C)$15,000

question 66

Multiple Choice

The following information is available for Aggie Auto Sales: $\begin{array}{lr}\text { Average operating assets } & \$ 750,000 \\\text { Controllable margin } & 90,000 \\\text { Contribution margin } & 175,000 \\\text { Minimum rate of return } & 10 \%\end{array}$ How much is Aggie Auto's residual income?

• A)$125,000
• B)$640,000
• C)$15,000
• D)$85,000

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Definitions:

Dollar Amount

A specific value of money in terms of the currency of the United States, expressed in dollars.

Investment Center

A division or unit within a company that is responsible for its own revenues, expenses, and assets, and its performance is evaluated on its return on investment.

Generates Revenue

Activities or processes that result in the earning of income for a business through the sale of goods or services.

Incurs Costs

To undergo or suffer expenses during the execution of activities or operations.