Assume Phipps Chips, a fictious snack company, makes artisan potato chips in a variety of flavors. The company sells 12-ounce bags of a variety of flavors in grocery store chains such as Whole Foods and Fresh Market for $8.00 a bag. Use the following financial data to calculate the ROI, RI, and EVA for Phipps Chips. Round all numbers and percentages to 2 decimal points. Remember: Interest costs are tax deductible, so you will need to consider the after-tax cost of financing debt when calculating EVA. Phipps Chips Projected Financial Data Current Assets $ 1,160,000 Long-Term Assets $ 2,660,000 Total Assets $ 3,820,000 Current Liabilities $ 1,110,000 Long-Term Liabilities $ 1,651,000 Total Liabilities $ 2,761,000 Equity $ 1,210,000 Production units 100,000 Sales Price $ 8 Target ROI 15% Fixed Costs $ 189,000 Variable Costs $ 1.50 Required Rate of Return 14% Income Tax Rate 25% Interest Rate 10%

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To calculate the Return on Investment ROI Residual Income RI and Economic Value Added EVA for Phipps ... View the full answer