Compute economic value added (EVA) for Beverly Software. The companys cost of capital is 5%. Net income

Question:

Compute economic value added (EVA) for Beverly Software. The company’s cost of capital is 5%. Net income was $770 thousand, interest expense $409 thousand, beginning long-term debt $700 thousand, and beginning stockholders equity was $3,060 thousand. Round all amounts to the nearest thousand dollars.

Should the company’s stockholders be happy with the EVA?

Cost Of Capital
Cost of capital refers to the opportunity cost of making a specific investment . Cost of capital (COC) is the rate of return that a firm must earn on its project investments to maintain its market value and attract funds. COC is the required rate of...