East Mullett Manufacturing earned operating income last year as shown in the following income statement: Sales $3,750,000
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Question:
East Mullett Manufacturing earned operating income last year as shown in the following income statement:
Sales $3,750,000
Cost of goods sold 2,250,000
Gross margin $1,500,000
Selling and administrative expense 1,200,000
Operating income $ 300,000
Less: Income taxes (@ 40%) 120,000
Net income $ 180,000
At the beginning of the year, the value of operating assets was $1,600,000.
At the end of the year, the value of operating assets was $1,400,000.
Total capital employed equaled $1,200,000.
East Mullett's actual cost of capital is 4%.
Required:
Calculate the EVA for East Mullett Manufacturing.
Related Book For
College Algebra Graphs and Models
ISBN: 978-0321845405
5th edition
Authors: Marvin L. Bittinger, Judith A. Beecher, David J. Ellenbogen, Judith A. Penna
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