Crane Decor sells home decor items through three distribution channels retail stores, the Internet, and catalog sales. Each
distribution channel is evaluated as an investment center. Selected results from the latest year are as follows:
a
Calculate the current residual income for each distribution channel. If the residual income is a loss then enter with a negative sign
preceding the number, eg or parenthesis, eg
Residual Income
Retail $
Online $
Catalog $
eTextbook and Media
Attempts: of used
b
The corporate office is giving the managers of each channel the option of a customer relationship management system that will
allow the managers to gather data about their customers and be more effective in their marketing efforts. The system will cost
$ and is expected to generate $ in additional annual segment margin.
Calculate the residual income of each distribution channel assuming it purchases the new customer relationship management
system. If the residual income is a loss then enter with a negative sign preceding the number, eg or parenthesis, eg
Residual Income
Retail $
Online $
