Economic value added is
A)essentially the same as residual income except that adjustments are made to liabilities and assets to eliminate "accounting distortions" caused by interest expense.
B)essentially the same as residual income except that adjustments are made to income and assets to eliminate "accounting distortions" that arise from following generally accepted accounting principles.
C)the use of qualitative and quantitative measures to evaluate performance.
D)essentially the same as residual income except that adjustments are made to income and assets to eliminate "accounting distortions" caused by noninterest-bearing current liabilities.

Question

Quizplus · Accepted Answer

Economic Value Added (EVA) is similar to residual income but includes adjustments to income and assets to correct for distortions that arise from adhering to generally accepted accounting principles (GAAP). This makes it a more accurate measure of a company's true economic profit.

Economic Value Added Is