As discussed in the chapter, abnormal earnings (AE) are AB: = Xt - (re " BVtl) where Kt is the firm's net income, re is the cost of equity capital, and 19th is the book value of equity at t 1. Following are xt, 3vt_1, and re for two firms. Company A 20x1 20x2 20x3 20x4 20x5 Kt $ 66,920 5 79,632 5 93,314 $ 89,920 $ 92,690 th_1 479,000 504,000 541,000 562,000 598,000 re 0.152 0.167 0.159 0.172 0.166 | Company a 20x1 2022 20x3 20x4 20x5 X: $ 192,940 $176,341 $227,700 $ 198,900 $ 202,964 BVtI 077,000 943,000 989,999 1,020,000 1,199,000 :5 0.193 0.179 0.183 0.175 0.196 | Required: 1. Calculate each firm's .43: each year from 20x1 to 20X5. (Round your final answers to the nearest whole dollar. Negative abnormal earnings should be indicated with a minus sign.) 2. Was Company B better managed over the 20X120X5 period? 3. Is Company B likely to be the better stock investment in 20X6 and beyond? Company A Company B Was Company B better managed over the 20X120X5 period? Is Company B likely to be the better stock investment in ZOXS and beyond