If a Division of a Multidivisional Firm Has Adjusted Accounting

question 55

Multiple Choice

If a division of a multidivisional firm has adjusted accounting earnings of $10 million, a weighted average cost of capital of 10% and a total capital employed by the division of $50 million, the division has an EVA of

• A) $25 million.
• B) $5 million.
• C) $15 million.
• D) $20 million.

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