Worldatwork Exam c8 Topic 3 Question 63 Discussion

Actual exam question for Worldatwork's c8 exam

Question #: 63
Topic #: 3

The XYZ Company opened a new manufacturing facility with a capital investment of 10,000,000. The cost to obtain the capital was 8%. In its first year of operations, the facility's net operating profit after taxes was 10,500,000. What was the economic value added (EVA) using the EVA formula?

A500,000

B840,000

C8,000,000

D9,700,000

Show Suggested Answer

Suggested Answer: D

by Margart at Feb 07, 2024, 03:35 PM

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Alline

1 days ago

Candidate 2: I disagree, I believe the EVA would be 840,000 because the net operating profit after taxes was higher than the cost of capital.

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Azzie

2 days ago

Candidate 1: I think the economic value added (EVA) would be 500,000 based on the EVA formula.

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