The Northern Division of Aussie Estates Has Reported a Profit

question 28

Multiple Choice

The northern division of Aussie Estates has reported a profit of $4 million. Divisional invested capital is $2.5 million and the imputed interest rate is 12 per cent. What is the residual income?

• A) $180 000
• B) $1.78 million
• C) $2.15 million
• D) $3 700 000

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Definitions:

Mucosal Membrane

Moist tissue layer lining body cavities or passages that are open to the exterior, such as the mouth, nose, and intestines.

Upper Epithelial Cells

The cells that are located on the surface layer of an epithelium, acting as a barrier against physical and microbial threats.

Endocrine Gland

A gland in the body that releases hormones directly into the bloodstream to regulate various processes such as growth, metabolism, and mood.

Bloodstream

The flowing body fluid that circulates through the heart, arteries, capillaries, and veins, carrying oxygen, nutrients, and white blood cells throughout the body.