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Beautyme Ltd has 2 divisions. Division A has a Profit of £350,000 after charging the allocated head office costs of £55,000. Division B has a Profit of £450,000 after charging the allocated head office costs of £85,000. Beautyme Ltd has invested £1.5 million in each of the 2 divisions and requires a return of 15% Calculate the Return on Investment (ROI) and Residual Income (RI) for both divisions

Beautyme Ltd has 2 divisions. Division A has a Profit of £350,000 after charging the allocated head office costs of £55,000. Division B has a Profit of £450,000 after charging the allocated head office costs of £85,000. Beautyme Ltd has invested £1.5 million in each of the 2 divisions and requires a return of 15% Calculate the Return on Investment (ROI) and Residual Income (RI) for both divisions

Survey of Accounting (Accounting I)
Survey of Accounting (Accounting I)
8th Edition
ISBN:9781305961883
Author:Carl Warren
Publisher:Carl Warren
Chapter14: Decentralized Operations
Section: Chapter Questions
Problem 3SEQ: Division A of Kern Co. has sales of $350,000, cost of goods sold of $200,000, operating expenses of...
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Beautyme Ltd has 2 divisions.
Division A has a Profit of £350,000 after charging the allocated head office costs of £55,000.
Division B has a Profit of £450,000 after charging the allocated head office costs of £85,000.
Beautyme Ltd has invested £1.5 million in each of the 2 divisions and requires a return of 15%
Calculate the Return on Investment (ROI) and Residual Income (RI) for both divisions

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