Response to the following problem:
Nelson Company has two divisions. The following information is available:
North Division South Division
Revenue $300,000 $500,000
After-tax operating income 100,000 90,000
Average invested capital 100,000 200,000
Invested capital at end of period 200,000 300,000
Cost of capital 20% 15%
Required:
Compute the following for each division:
A) Return on investment
B) Return on sales
C) Capital turnover
D) Residual income.