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Required information [The following information applies to the questions displayed below.) Megamart, a retailer of consumer goods, provides the following information on two of its departments (each considered an investment center) Investment Center Electronics Sporting goods Sales Income $40,250,000 $3,059,000 21,280,000 2,178,000 Average Invented onete $16,100,000 12,100,000 1. Compute return on investment for each department. Using return on investment, which department is most efficient at using assets to generate returns for the company? 2. Assume a target income level of 10% of average invested assets. Compute residual income for each department. Which department generated the most residual income for the company? 3. Assume the Electronics department is presented with a new investment opportunity that will yield a 14% return on investment. Should the new Investment opportunity be accepted? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Assume a target Income level of 10% of average Invested assets. Compute residual income for each department. Which department generated the most residual income for the company? Investment Center Electronics Sporting Goods Net income $ 3,059,000 $ 2,178,000 Target net income Residual income Which department is most efficient at using assets to generate returns for the company?

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