Book value:

Marketible securities:

50,000

Non-operating long-term assets:

20,000

Cash:

130,000

Accounts receivable:

200,000

Inventory:

100,000

Operating long-term assets:

800,000

Accounts payable:

178,000

Accrued taxes:

100,000

Short-term debt:

120,000

Long-term debt:

Par value per bond:

1,000

Number of bonds:

550

Total book value, long-term debt:

550,000

Common stock:

Par value per share: 10

Number of shares: 35,200 352,000

Total book value, common stock:

Market value:

Marketible securities:

50,000

Non-operating long-term assets:

25,000

Short-term debt:

120,000

Long-term debt:

Market value per bond 950

Common stock:

Market value per share 13.50

Other data:

WACCcomp

0.10

Revenue

500,000

Fixed costs

40,000

Variable costs as a % of revenue

0.50

Depreciation

55,000

Corporate tax rate

0.40

What is the economic value added (EVA) based on operating capital?

a. $2,000

b. -$2,200*

c. -$2,300

d. $1,500