Assume the Outflow Division of Kipper Faucets had the following results last year: Net sales $5,150,000 Operating income $2,060,000 Return on investment 20% Management’s target rate of return 16% 7. What is the division’s profit margin ratio? A. 250% B. 80% C. 40% D. 20% (answer) 8. What is the division’s asset turnover ratio? A. 0.20 (answer) B. 0.50 C. 1.25 D. 2.00 9. What is the division’s residual income? A. $ 3,090,000 B. $ 1,648,000 C. $ 412,000 D. $ 82,400