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whitedreamerz whitedreamerz
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3 months ago
Jumbo Industries is considering the purchase of equipment costing $80,000. The company has a 12% required minimum rate of return. The equipment is expected to generate $20,000 in additional operating income. Jumbo's tax rate is 25% and its weighted-average cost of capital is 12%. What is the equipment's EVA?

▸ $9,600

▸ $7,200

▸ $2,400

▸ $5,400
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Managerial Accounting

Managerial Accounting


Edition: 4th
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daniboidaniboi
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3 months ago
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$5,400

(75% × $20,000) - ($80,000 × 12%) = $5,400
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whitedreamerz Author
wrote...

3 months ago
Good timing, thanks!
DAGINC
wrote...

Yesterday
I appreciate what you did here, answered it right Smiling Face with Open Mouth
rene_ram97
wrote...

2 hours ago
Smart ... Thanks!
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