Q1) Safety Seats Co. recorded operating data for its shoe division for year. Company's desired ROI is 5%.
Sales

$500,000

Variable costs

400,000

Contribution margin

100,000

Total direct fixed costs

60,000

Average total operating assets

200,000

Compute the residual income?
i) $20,000
ii) $30,000
iii) $40,000
iv) $90,000
v) $100,000