The Casket Division of Saal Corporation had average operating assets of $950,000 and net operating income of $135,200 in January. The company uses residual income to evaluate the performance of its divisions, with a minimum required rate of return of 13%.Required:What was the Casket Division's residual income in January?
What will be an ideal response?
| Net operating income | $ | 135,200 |
| Minimum required return (13% × $950,000) | 123,500 | |
| Residual income | $ | 11,700 |
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