Wiswell Inc. reported the following results from last year's operations: Sales$15,200,000Variable expenses 9,270,000Contribution margin 5,930,000Fixed expenses 5,018,000Net operating income$912,000?The average operating assets were $8,000,000.?At the beginning of this year, the company has a $900,000 investment opportunity that would involve sales of $2,070,000, a contribution margin ratio of 30% of sales, and fixed expenses of $538,200. The company's minimum required rate of return is 10%. If the company pursues the investment opportunity, this year's combined residual income for the entire company will be closest to:
A. $104,800
B. ($19,800)
C. $994,800
D. $925,600
Answer: A
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