Answer:
The division's residual income is closest to $2,192,960
Explanation:
Residual income=net income-(average operating assets*required rate of return)
net operating income is $3,508,960
average operating assets is $ 9,400,000
required rate of return is 14%
residual income =$3,508,960-($9,400,000*14%)
residual income=$3,508,960-$1,316,000
residual income =$2,192,960
The residual income is the residue of net income after deducting an amount equivalent of cost of using the assets of the company funded by finance providers.
