Question
1. Pearson Brothers reported $80 million of net income and $140 million of retained earnings. In the previous year, the company had $110 million of
1. Pearson Brothers reported $80 million of net income and $140 million of retained earnings. In the previous year, the company had $110 million of retained earnings. How much dividends were paid to the companys shareholders during the year? Assume that all dividends declared were actually paid.
2. The Century City Construction Inc. had $45 million of sales and $35 million of operating costs including depreciation. The company has $30 million of investor-supplied operating capital that has a cost of capital of 10%. What was the firms economic value added (EVA) given the companys overall tax rate of 35%?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started