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Thompson Ltd.has a division that generated $5 000 000 in sales and operating income of $1 000 000 on average operating assets of $2 800 000.The company's management team expects division managers to generate sufficient income to guarantee a minimum return of 15 per cent.
Required:
A. What is the division's residual income?
B. What is the division's return on investment (ROI)?
Competitors
Other businesses or individuals that offer similar products or services and vie for the same customers or market share.
Focused Differentiation Strategy
A business approach where a company offers unique products or services to a specific, narrow target market.
Competitive Advantage
A condition or circumstance that places a company or entity in a favorable or superior position relative to competitors.
Unique Product
A good or service that is distinct in its features, benefits, or value proposition compared to others in the market.
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