A Firm Has an Average Investment of $10,000 During the Year.During

question 44

Multiple Choice

A firm has an average investment of $10,000 during the year.During the same period,the firm generates after-tax income of $1,000.
Calculate the economic value added (EVA) for the firm.(The cost of capital is 15%.)

• A)-$500
• B)$1,500
• C)$1,200
• D)$1,000

---

Definitions:

Financial Statements

Documents that present an organization's financial activity and condition, including balance sheet, income statement, and cash flow statement.

Related Parties

Parties are considered related if one party has the ability to control or significantly influence the financial and operational decisions of another.

Non-executive Directors

Individuals who sit on a company's board but are not part of the day-to-day management, often providing independent oversight.

Related Party Transactions

Financial dealings between parties that have a relationship with the entity, which can include transactions with family members, key management personnel, or major shareholders.