Question
Computing, Analyzing and Interpreting Residual Operating Income (ROPI) In its annual report for the fiscal year ended July 27, 2019, Cisco Systems reports the following
Computing, Analyzing and Interpreting Residual Operating Income (ROPI)
In its annual report for the fiscal year ended July 27, 2019, Cisco Systems reports the following ($ million):
| July 27, 2019 | |
|---|---|
| Net operating profit after tax (NOPAT) | $6,808 |
| Net operating assets (NOA) beginning | $13,335 |
Assuming the following weighted average cost of capital (WACC), what is Cisco's residual operating income (ROPI) for the fiscal year ended July 27, 2019?
| WACC |
|---|
| 7.6% |
| ROPI | Answer |
b. At what level of WACC would Cisco not report positive residual operating income for the year?
| WACC | Answer |
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Contemporary Auditing real issues and cases
Authors: Michael C. Knapp
9th edition
978-1133839552, 113383955X, 1133187897, 978-1133710424, 1133710425, 978-1133187899
