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Please solve all $6$ requirements. if it is ocrrect I will give a thumbs up thank you!. Donaldson Ceramics, a division of Gammaro Corporation, has an operating income of $$54,000$ and total assets of $$432,000.$ The required rate of return for the company is $9\%.$ The company is

evaluating whether it should use return on investment $($ ROI or residual income $(RI)$ as a measurement of performance for its division managers. The manager of Donaldson Ceramics has the

opportunity to undertake a new project that will require an investment of $$108,000.$ This investment would earn $$10,800$ for the company.

Read the requirements.

Requirement $1.$ What is the original return on investment $($ ROI $)$ for Donaldson Ceramics $($before making any additional investment$)?$

First determine the formula to calculate the ROI.

Operating income $$ Total

The original return on investment $($ROI$)$ for Donaldson Ceramics is $\%.$

Requirement $2.$ What would the ROI be for Donaldson Ceramics if this investment oppo

investment if she were evaluated based on ROI? Why or why not? $($Enter the percentage

If this investment opportunity were undertaken, the ROI would be

$\%.$

Requirements

What is the original return on investment $($ROI$)$ for Donaldson Ceramics $($before making any

additional investment$)?$

What would the ROI be for Donaldson Ceramics if this investment opportunity were undertaken?

Would the manager of the Donaldson Ceramics division want to make this investment if she were

evaluated based on ROI? Why or why not?

What is the ROI of the investment opportunity? Would the investment be desirable from the

standpoint of Gammaro Corporation? Why or why not?

What would the residual income $($RI$)$ be for Donaldson Ceramics if this investment opportunity

were to be undertaken? Would the manager of the Donaldson Ceramics division want to make

this investment if she were evaluated based on RI$?$ Why or why not?

What is the RI of the investment opportunity? Would the investment be desirable from the

standpoint of Gammaro Corporation? Why or why not?

Which performance measurement method, ROI or RI$,$ promotes goal congruence? Why?

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