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1 . Scranton Shipyards has $ 2 5 million in total net operating capital. The company's WACC is 9 percent. What is Scranton's EVA? If

1. Scranton Shipyards has $25 million in total net operating capital. The company's WACC is 9 percent. What is Scranton's EVA? If negative, use the negative sign instead of parentheses, e.g.-130,000.
The company has the following income statement:
Sales
$10.0 million
Operating costs
6.0 million
Operating income (EBIT)
$ 4.0 million
Interest expense
2.0 million
Earnings before taxes (EBT)
$ 2.0 million
Taxes (40%)
0.8 million
Net income
$ 1.2 million
2.New Mexico Lumber recently reported that its earnings per share were $3.5. The company has 400,000 shares of stock outstanding. The company's interest expense was $500,000. The corporate tax rate is 36 percent. What was the company's operating income (EBIT)? If necessary, round it to a whole dollar.

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