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fudger fudger
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6 years ago
Stonex Corp, whose tax rate is 40%, has two sources of funds: long-term debt with a market value of $6,000,000 and an interest rate of 8%, and equity capital with a market value of $14,000,000 and a cost of equity of 12%. Stonex has two operating divisions, the Blue division and the Gold division, with the following financial measures for the current year:

Total AssetsCurrent LiabilitiesOperating Income
Blue Div.$9,500,000$2,500,000$1,155,000
Gold Div.$10,000,000$2,400,000 $1,200,000

Calculate EVA for the Gold Division.
A) ($57,640)
B) ($27,840)
C) ($37,340)
D) $397,440
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love-civiclove-civic
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#1
Posts: 175
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6 years ago
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fudger Author
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6 years ago
Thanks
elizabetheldrid
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Yesterday
I appreciate what you did here, answered it right Smiling Face with Open Mouth
zbmallo3
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2 hours ago
Just got PERFECT on my quiz
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