The Following Information Relates to Hudston, Inc If the Company Has a 10% Weighted-Average Cost of Capital

question 89

Multiple Choice

The following information relates to Hudston, Inc.: $$\begin{array} { l r } \text { Total assets } & \$ 9,000,000 \\\text { After-tax operating income } & 1,500,000 \\\text { Current liabilities } & 800,000\end{array}$$ If the company has a 10% weighted-average cost of capital, its economic value added would be:

• A) $(200,000).
• B) $530,000.
• C) $680,000.
• D) $970,000.
• E) None of the other answers are correct.

Appreciate the nuance between different types of shares and their attributes.

Analyze the process and implications of incorporating a business.

Recognize the importance and process of maintaining a corporation's compliance with legal requirements.

Distinguish between broadly held and closely held corporations and understand their characteristics.

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Definitions:

Cellulitis

A common, potentially serious bacterial skin infection that appears as a swollen, red area of skin that feels hot and tender.

Orbit

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Acute Conjunctivitis

An infection or inflammation of the conjunctiva, often characterized by redness, itching, and watering of the eyes.

Dacryocystitis

An infection of the tear sac (dacryocyst) at the corner of the eye, leading to inflammation and often blockage of the tear duct.