Answer:
a. ROI = income / Assets      
                                       Book Value       Current Value	    
Software Division              0.175              0.13    
Consulting Division           0.164              0.182    
Venture Capital Division   0.093            0.088
<u>Workings:</u>
i. Book value
Software Division = 12,250/70,000=0.175
Consulting Division = 16,400/100,000=0.164  
Venture Capital Division
= 56,730/610,000 =0.093 
ii. Current value
Software Division = 11,700/90,000=0.13
Consulting Division = 20,020/110,000=0.182
Venture Capital Division=
51,920/ 590,000=0.088
b. Residual income = Income - {Asset x Return on capital 12% }
                                       Book Value       Current Value	    
Software Division              3850              900    
Consulting Division           4400              6820    
Venture Capital Division   -16470           -18880
<u>Workings:</u>
i. Book value
Software Division = 12,250-(70,000*12%)=3850
Consulting Division = 16,400-(100,000*12%)=4400  
Venture Capital Division
= 56,730-(610,000*12%) =-16470
ii. Current value
Software Division = 11,700-(90,000*12%)=900
Consulting Division = 20,020-(110,000*12%)=6820	
Venture Capital Division=
51,920-(590,000*12%)=-18880
c. Economic Value Added ( EVA ) = Net Income After Tax - ( Amount of Capital x Weighted Average Cost of Capital [WACC] )
C.                      Software Division  
                             (Value Base)  
                                     Book            Current
Sales                           100,000          100,000
Income                          12,250           11,700	
Assets                           70,000          90,000
Liabilities                      10,000           10,000
Capital invested           60,000          80,000
(Asset - Liabilities)
Tax on Income(30%)     3675            3510
Income after Tax            8,575           8,190 
(Income - Tax on
income) (A)
Capital invested             6,000           8,000
* WACC - 10% ) (B)
EVA (C)=(A)-(B)                2,575            190
                         Consulting Division
                             (Value Base)
                                      Book            Current
Sales                         200,000        200,000
Income                        16,400           20,020
Assets                         100,000        110,000
Liabilities                      14,000         14,000
Capital invested           86,000       96,000
(Asset - Liabilities)
Tax on Income(30%)     4920            6006
Income after Tax           11,480           14,014
(Income - Tax on
income) (A)
Capital invested           8,600            9,600
* WACC - 10% ) (B)
EVA (C)=(A)-(B)              2,880            4,414
                       Venture Capital Division
                            (Value Base)
                                    Book            Current
Sales                        800,000       800,000
Income                      56,730          51,920
Assets                       610,000        590,000
Liabilities                    40,000         40,000
Capital invested        570,000        550,000
(Asset - Liabilities)
Tax on Income(30%)    17019          15576
Income after Tax          39,711         36,344
(Income - Tax on
income) (A)
Capital invested           57,000       55,000
* WACC - 10% ) (B)
EVA (C)=(A)-(B)              -17,289       -18,656