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As the Staff Accountant for Investment Centers Beta and Gamma,compute

question 17

Essay

As the staff accountant for Investment Centers Beta and Gamma,compute the residual income for each investment center,using the following information:
 Beta  Gamuma  Operating income $850,000$1,000,000 Actual ROI 28%49% Desired ROI 32%35% As5ets invested $585,000$750,000\begin{array} { | l r r | } \hline & \text { Beta } & \text { Gamuma } \\\text { Operating income } & \$ 850,000 & \$ 1,000,000 \\\text { Actual ROI } & 28 \% & 49 \% \\\text { Desired ROI } & 32 \% & 35 \% \\\text { As5ets invested } & \$ 585,000 & \$ 750,000 \\\hline\end{array}

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Definitions:

Slope

A measure of the steepness or incline of a line, calculated as the ratio of the vertical change to the horizontal change between two points on the line.

Intercept

In linear regression, it is the expected value of the dependent variable when all independent variables are zero.

Predicted Income

An estimate of the amount of money that an individual or entity is expected to earn in the future.

Slope

The measure of the steepness or incline of a line, typically representing the rate of change between two variables in a linear relationship.

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