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Sir I did not understand this explanation of part d
This decision will be in the best interests of the company as a whole, since the RI of the investment alone is
actually negative ($132k – $212k = $(80k)).Could you please explain where the figure $132K comes from ? How is it calculated?
The profit with the investment is $3864. The profit without the investment (from the answer to part (a) is $3732. So the difference is $132.
Similarly the imputed interest with the investment is $2532. The imputed interest without the investment (from part (a)) is $2320. So the difference is $212.
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