If net operating income is $34,000, average operating assets are $204,000, and the minimum required rate of return is 15%, what is the residual income

The residual income is $3,400.

Explanation:

Residual Income is calculated as Profit less Return on investment.

Net operating income $34,000

Less Return on Investment ($204,000 * 15%) ($30,600)

Residual income $3,400

Conclusion:

The residual income is $3,400.