1. Non-current assets (a) Fixed Assets 1,00,00,000 2. Current Assets (a) Inventories ) Raw Material 86,400 (1) Finished Goods 1,71,360 (b) Account receivable 4,29.300 (c) Cash 4,940 TOTAL 1,06,92,000 Statement of Profit of ABC Limited Sales 28,62.000 Less: Operating Expenses 11,48,400 EBIT 17,13,600 Less: Tax Expensen 6,85,440 NOPAT 10,28,160 The average rate of return on similar types of companies is 20% while risk free return is 12.5%. Rate of return as charged by bank is 18% and the tax rate is 40%. Calculate Economic Value Added.

1. Non-current assets (a) Fixed Assets 1,00,00,000 2. Current Assets (a) Inventories ) Raw Material 86,400 (1) Finished Goods 1,71,360 (b) Account receivable 4,29.300 (c) Cash 4,940 TOTAL 1,06,92,000 Statement of Profit of ABC Limited Sales 28,62.000 Less: Operating Expenses 11,48,400 EBIT 17,13,600 Less: Tax Expensen 6,85,440 NOPAT 10,28,160 The average rate of return on similar types of companies is 20% while risk free return is 12.5%. Rate of return as charged by bank is 18% and the tax rate is 40%. Calculate Economic Value Added.

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter9: Long-term Liabilities

Section: Chapter Questions

Problem 89E: Ratio Analysis Rising Stars Academy provided the following information on its 2019 balance sheet and...

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