Care Inc ,Has Two Divisions That Operate Independently of One Another

question 44

Multiple Choice

Care Inc. ,has two divisions that operate independently of one another.The financial data for the year 2015 reported the following results:

The company's desired rate of return is 10%.Income is defined as operating income.
Which division has the best return on investment and which division has the best residual income figure,respectively?

• A)North,North
• B)South,South
• C)North,South
• D)South,North

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Definitions:

Nutrition Drink

A beverage designed to provide dietary supplements or essential nutrients that might be missing or insufficient in a person's diet.

Labor Price Variance

The difference between the actual cost of direct labor and the standard cost, typically associated with the rate paid for labor.

Labor Quantity Variance

The difference between the actual hours worked and the standard hours expected, multiplied by the standard hourly wage rate.

Standard Costing System

A cost accounting system that assigns predetermined costs to products and services, used to plan budgets and assess performance by comparing actual costs against these standards.