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CTP · Question #813
(Topic 9) James Corp has a 7.98% WACC and an assumed tax rate of 30%. James Corp employed €70,000,000 of capital (long-term debt and equity) in a project that generated an operating profit of…
The correct answer is B. €1,064,000. See the full explanation below for the reasoning.
Question
- (Topic 9)
James Corp has a 7.98% WACC and an assumed tax rate of 30%. James Corp employed €70,000,000 of capital (long-term debt and equity) in a project that generated an operating profit of €9,500,000, after depreciation expense of €300,000. EVA in this case would be:
Options
- A€764,000.
- B€1,064,000.
- C€1,087,940.
- D€1,274,000.
How the community answered
(52 responses)- A13% (7)
- B77% (40)
- C4% (2)
- D6% (3)
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