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Assume that next year research in motion sells off its

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Reference no: EM13581356

Assume that next year Research in Motion sells off its interest in TIP Communications (one of its subsidiaries). Forecasted information about the operations for RIM and TIP for that future fiscal year immediately prior to the proposed sale follows:

Millions

RIM*

TIP

Total

Revenues

20,943

1,727

22,670

Operating Expense(t)

20,321

1,971

22,292

*Does not include TIP results. (t)Includes cost of goods sold

Required:

  1. Compute operating income for RIM and TIP, separately, and the total operating income for both.
  2. If the results in part 1 for TIP are typical, why do you believe RIM decided to sell off its interest in TIP?

Reference no: EM13581356

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