Barnes' Brothers Has the Following Data for the Year Ending

question 60

Multiple Choice

Barnes' Brothers has the following data for the year ending 12/31/10: Net income = $600; Net operating profit after taxes (NOPAT) = $700; Total assets = $2,500; Short-term investments = $200; Stockholders' equity = $1,800; Total debt = $700; and Total operating capital = $2,100.Barnes' weighted average cost of capital is 10%.What is its economic value added (EVA) ?

• A)$399.11
• B)$420.11
• C)$442.23
• D)$465.50
• E)$490.00

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Definitions:

Fiedler's Contingency Theory

A leadership model asserting that the effectiveness of a leader's style is contingent on the situational context, including the leader's relationships with followers and task structure.

LPC

Least Preferred Coworker scale, a tool used in Fiedler's Contingency Theory to measure a leader's task or relationship orientation.

Leadership

The act or ability of leading a group towards achieving a common goal, often involving inspiring and guiding others.

Low LPC Leader

A leadership style characterized by a primary focus on completing tasks and obtaining results over building relationships, according to the Least Preferred Coworker (LPC) theory.