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Compute the economic profit at an imputed interest rate

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Reference no: EM131765342

Question - The following information pertains to Robert Company:

Total assets                                        $50,000

Total current liabilities                    10,000

Total expenses                                 60,000

Total liabilities                                    15,000

Total revenues                                  80,000

If invested capital is defined as total assets minus current liabilities, the economic profit (residual income) at an imputed interest rate of 20% is _____.

A. $12,000

B. $20,000

C. $4,000

D. $2,600

Reference no: EM131765342

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