Compute the companys economic value added

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l. Bon Temps’ financial statements show the following information: Average cost of funds 10.0 % EBIT $ 500,000 Total capital $1,250,000 EPS $2.00 Shares outstanding 150,000 Marginal tax rate 30.0% (1) Compute the company’s economic value added (EVA) (2) Interpret the value you computed in part l (1). m. Suppose that normally Bon Temps’ P/E ratio is 20x. Using the information given in part (l), estimate the market price per share for Bon Temps’ common stock.

Reference no: EM131049803

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