a. Jorja Inc. has the following information for the previous year: Net income = $200; Net operating profit after taxes (NOPAT) = $300; Total assets = $1,000; and Total net operating capital = $800. The information for the current year is: Net income = $500; Net operating profit after taxes (NOPAT) = $400; Total assets = $1,300; and Total net operating capital = $900. What is the free cash flow for the current year?
b. Zentex recently reported the following information:
Net income = $600,000.
Tax rate = 40%.
Interest expense = $200,000.
Operating capital = $9 million.
After-tax cost of capital = 10%.
What is the company’s EVA?
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