Page 14 - Manac Costing Test 2 class slides - 3. Performance Measurement
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PERFORMANCE MEASUREMENT
RI example (cont)
Net operating assets R400 000
Net operating income R80 000
Minimum required rate of return 15%
Calculate the current RI:
R80 000 – (R400 000 x 15%) = + 20 000
Therefore currently the company is performing well as they
have generated residual income of R20 000.
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