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Akash Kular is the Chief Financial Officer of the Calgary division of ThermoDynamics Incorporated...

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Accounting

Akash Kular is the Chief Financial Officer of the Calgary division of
ThermoDynamics Incorporated (TDI). Akash is evaluated on a
combination of Return on Investment, Residual Income and Return on
Sales. His annual bonus breakdown is as follows:
ROI Bonus = Return on Investment for the year x50%
RI Bonus = Residual Income from all investments throughout
the year
ROS Bonus = Return on Sales x 30%
Bonus formula = ROI Bonus ROS Bonus RI Bonus
The Calgary division of TDI had the following financials in 2023:
Sales were $10,500,000
Expenses were $7,750,000
Cash on hand was $1,575,000
Assets on hand were $9,800,000
Loans outstanding were $2,250,000
Retained Earnings was $3,975,000
Required
What is the annual bonus that Akash will receive for the 2023
operating year his required rate of return was 8%?
If Akash had the opportunity at the end of 2023 to take on a project
that would cost $1,500,000 and produce Sales of 200,000 and incur
expenses of $20,000. Would he accept the project given his current
bonus structure?
PLEASE SOLVE THIS AS SOON AS POSSIBLE
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