The following information pertains to Garcia Company:
Total assets $50,000
Net operating profit after taxes $10,000
Total current liabilities $10,000
Total expenses $60,000
Total liabilities $15,000
Total revenues $80,000
Invested capital is defined as total assets minus current liabilities. The after-tax cost of capital is 20%. What is the residual income?
A) $2,000
B) $4,000
C) $12,000
D) $20,000
A
Business
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A) $22,080 B) $220,800 C) $184,000 D) $667,920
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Managed reuse is a less expensive method of managing software reuse
Indicate whether the statement is true or false
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