Brodrick Corporation uses residual income to evaluate the performance of its divisions. The minimum required rate of return for performance evaluation purposes is 19%. The Games Division had average operating assets of $140,000 and net operating income of $25,900 in August.Required:What was the Games Division's residual income in August?
What will be an ideal response?
| Net operating income | $ | 25,900 | |
| Minimum required return (19% × $140,000) | 26,600 | ||
| Residual income | $ | (700 | ) |
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