1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
schepotkina [342]
3 years ago
6

HHH Inc. reported $12,500 of sales and $7,025 of operating costs (including depreciation). The company had $18,750 of investor-s

upplied operating assets (or capital), the weighted average cost of that capital (the WACC) was 9.5%, and the federal-plus-state income tax rate was 25%. What was HHH's Economic Value Added (EVA), i.e., how much value did management add to stockholders' wealth during the year?
Business
1 answer:
djverab [1.8K]3 years ago
4 0

Answer:

$2,325

Explanation:

The computation of the economic value added is shown below:

Economic value added = NOPAT - total invested capital × WACC  

where,  

NOPAT = Operating income × (1 - tax rate)

= (Sales - operating cost) × (1 - 0.25)

= ($12,500 - $7,025) × (1 - 0.25)

= $4,106.25

And, the other values would remain same

= $4,106.25 - $18,750 × 9.5%

=  $4,106.25 - $1,781.25

= $2,325

You might be interested in
You are analyzing a project and have developed the following estimates. The depreciation is $11,000 a year and the tax rate is 3
77julia77 [94]

Answer:

no option is correct, check the question to see if it was copied correctly and check the work to verify my answer

$1,430

Explanation:

worst case scenario:

2,500 units sold at $16 = $40,000

variable cost per unit $14 x 2,500 units = $35,000

contribution margin = $5,000

fixed costs = $8,500

depreciation expense = $11,000

cash flow = [(contribution margin - fixed costs - depreciation) x (1 - tax rate)] + depreciation

cash flow = [($5,000 - $8,500 - $11,000) x 0.66] + $11,000 = $1,430

8 0
3 years ago
If a firm is selling a search good it is more likely to
Hitman42 [59]
<span>If a firm is selling a search good, you will no doubt find them using informational advertising to promote their product because it has proven to be the most effective for this type of good. On the other hand, if they are selling an experience good, the advertising they will probably employ is persuasive advertising. Many companies have spent millions of dollars researching the best form of advertising for each product they offer for sale.</span>
3 0
3 years ago
From a strategic marketing viewpoint, a total product offer includes all of the tangible attributes of a good or service, and ex
Tasya [4]

Answer:

B. False

Explanation:

<em>Total Product offer </em>is every aspect of a product which the customer evaluates before buying.

From strategic marketing viewpoint, the customer may evaluate the product on both the tangible and intangible attributes.

An example of this is the iPhone by Apple. On tangible level, the product itself, the packaging and others are tangible attributes that a customer may evaluate. On intangible level, the brand name, perceived benefits, convenience, purchase services, and many other factors are part of the iPhone as the intangible attributes that the customer will evaluate.

As a marketer, one should think and talk in the language of customers- let it be from either tangible or intangible point of view.    

7 0
3 years ago
Finishing Touches has two classes of stock authorized: 8%, $10 par preferred, and $1 par value common. The following transaction
Elza [17]

Answer:

See explaination and attachment

Explanation:

Stockholders' equity is the amount of assets remaining in a business after all liabilities have been settled. It is calculated as the capital given to a business by its shareholders, plus donated capital and earnings generated by the operation of the business, less any dividends issued.

Balance Sheet is a statement of the assets, liabilities, and capital of a business or other organization at a particular point in time, detailing the balance of income and expenditure over the preceding period.

See attachment for the step by step solution of the given problem.

8 0
3 years ago
Sheridan Repair Shop had the following transactions during the first month of business as a proprietorship. Journalize the trans
Andre45 [30]

Answer: Explanation:

We debit the contributed assets and credit the capital account

cash          11,290 debit

equipment 2,740 debit

    capital account           14,030 credit ( 11290 + 2740)

we debit the asset and recognize the payable amount

supplies       450 debit

   account payable       450 credit

we debit the assets and credit the revenue

cash                       1,303 debit

account receivable 689 debit

             service revenue     1,992 credit (1303 + 689)

we debit the expense and credit the asset we use to pay it

rent expense      634 debit

       cash                           634 credit

we debit the expense and credit the consumed asset

supplies expense     187 debit (450 purchase - 263 at hand)

               supplies            187 credit

8 0
3 years ago
Other questions:
  • Applewood, Inc. has a contract with Marco's Electronics to sell Marco's 500 car audio systems at a price of $100 each. Applewood
    7·1 answer
  • A(n) ____________ goal can be vulnerable to encouraging employee temptation toward dishonesty and to behave unethically if that
    10·1 answer
  • Q2. Clare works at the front desk of DESB. Between 10:30am and 11:00am, 10 students stop by to ask questions on average. It usua
    8·1 answer
  • Economies of scope Question 21 options: stem from the cost-saving efficiencies of scattering a company's manufacturing/assembly
    6·2 answers
  • Income elasticity of demand is
    14·2 answers
  • Suppose a firm incurred explicit costs of $900 and implicit costs of $200 during a day. If that day the firm sold 8 units at $30
    9·1 answer
  • Which of the following is NOT a repayment plan option? What is the answer
    13·1 answer
  • Imagine you are in the process of buying a new car. Give at least two examples of both qualitative and quantitative data that yo
    11·1 answer
  • Because it is needed for the schedule of expected cash collections, the annual master budget file includes the.
    9·1 answer
  • A firm can produce 1,000 bushels of wheat per year with two workers or 1,300 bushels of wheat per year with four workers. The ma
    13·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!