Compute the EVA for B Division for the year ended June

Assignment Help Accounting Basics
Reference no: EM133125903

Question - B Division of Z Ltd has operating profits and assets for the year ended 30 June 2021 as below:

Operating profit

$170,000

Less: Non-cash expenses

$6,000

Less: Amortisation of goodwill

$4,000

Less: Interest @ 10%

$15,000

Profit before tax

$145,000

Tax @ 30%

$43500

Profits after tax

$101500



Total equity

$346,000

Long-term debt

$150,000


$496,000

Z Ltd has a target capital structure of 25% debt/75% equity. The cost of equity is estimated at 14%. The capital employed at the start of the year amounted to $485,000. Goodwill previously written off against reserves on acquisitions in previous years amounted to $40,000.

Required - Compute the EVA for B Division for the year ended 30 June 2021?

Reference no: EM133125903

Questions Cloud

Reasons for out of control inflation : MEI company is considering whether to buy a manufacturing equipment now for 540.3000, or wait 3 years and buy it for $500,000. A] What do you recommend to BMI a
Flexible wages and adaptive expectations : Taxes decline. Explain and diagrammatically represent what happens to P, Y, W, and N. Please help me with diagrammatically
Analysis of labour market impacts of covid-19 : A dominant theme of the analysis of the labour market impacts of COVID-19 has been the significant decrease in the labour force participation of women, especial
Describe impact barriers to entry have on market equilibrium : Describe the impact barriers to entry have on market equilibrium.
Compute the EVA for B Division for the year ended June : Z Ltd has a target capital structure of 25% debt/75% equity. The cost of equity is estimated at 14%. Compute the EVA for B Division for the year ended June
Perfectly competitive market equilibrium : There are two firms in a market. Assume the demand function in the market is Q=100-P. Each firm has MC=AC=20.
What is a government : What is a government? Do you think that government intervention is needed inyour daily life and activities? Why?
Effective and ethical health practitioner : Competencies and knowledge areas required to work as an effective and ethical health practitioner
Numerical elasticity of function a : The functions on a Marshallian Cross are as follows: That on function A, P0 = 80, Q0 = 20; and P1 = 20, Q1 = 40.

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd