3 ints eBook Print eferences Here are simplified financial statements for Watervan Corporation: INCOME STATEMENT (Figures in $ millions) Net sales. Cost of goods sold Depreciation Earnings before interest and taxes (EBIT) Interest expense Income before tax Taxes Net income Assets BALANCE SHEET (Figures in $ millions) $ 881 741 31 $ 109 12 Current assets Long-term assets Total assets Liabilities and shareholders' equity Current liabilities. Long-term debt Shareholders' equity Total liabilities and shareholders' equity a. Economic value added b. Return on capital c. Return on equity d. Is the company creating value for its shareholders? $ 97 20 $ 77 End of Year $369 258 $627 $ 194 108 325 $ 627 Start of Year $312 222 $ 534 The company's cost of capital is 8.5%. Required: a. Calculate Watervan's economic value added (EVA). Note: Do not round intermediate calculations. Enter your answer in millions rounded to 2 decimal places. b. What is the company's return on capital? (Use start-of-year rather than average capital.) Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. c. What is its return on equity? (Use start-of-year rather than average equity.) Note: Enter your answer as a percent rounded to 2 decimal places. d. Is the company creating value for its shareholders? million % % $ 157 121 256 $534

Here are simplified financial statements for Watervan Corporation: The company's cost of capital is 8.5%. Required: a. Calculate Watervan's economic value added (EVA). Note: Do not round intermediate calculations. Enter your answer in millions rounded to 2 decimal places. b. What is the company's return on capital? (Use start-of-year rather than average capital.) Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. c. What is its return on equity? (Use start-of-year rather than average equity.) Note: Enter your answer as a percent rounded to 2 decimal places. d. Is the company creating value for its shareholders