Assume That Divisional Income from Operations Amounts to $192,000 and Top

question 45

Multiple Choice

Assume that divisional income from operations amounts to $192,000 and top management has established 15% as the minimum rate of return on divisional assets totaling $1,000,000. The residual income for the division is:

• A) $42,000
• B) $28,800
• C) $92,000
• D) $0

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Definitions:

Constructive

Referring to actions, comments, or criticism that are intended to be helpful and lead to positive outcomes or improvement.

Locus of Control

A psychological concept referring to the extent to which individuals believe they have control over the events affecting them.

Self-Esteem

An individual's perception of their own worth or value.

Incapable

Lacking the ability, strength, or competence to do something effectively or as required.