The Tandem division of the Great Adventures Cycles Company had the following results last year (in thousands).

Management's target rate of return is 10% and the weighted average cost of capital is 8%.Its effective tax rate is 40%.
What is the Tandem division's Economic Value Added (EVA)?
A)$136,000
B)$152,000
C)$280,000
D)$288,000

Question

The Tandem division of the Great Adventures Cycles Company had the following results last year (in thousands).

Management's target rate of return is 10% and the weighted average cost of capital is 8%.Its effective tax rate is 40%.
What is the Tandem division's Economic Value Added (EVA)?
A)$136,000 
B)$152,000 
C)$280,000 
D)$288,000

Quizplus · Accepted Answer

Selected financial data for The Plastic Lumber Company's Outdoor Furniture Division is as follows:
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The Tandem Division of the Great Adventures Cycles Company Had