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Economic Value Added Washington Company has two divisions: the Adams Division and the Jefferson Division. The following information pertains to last year's results: Adams Division
Economic Value Added Washington Company has two divisions: the Adams Division and the Jefferson Division. The following information pertains to last year's results: Adams Division Jefferson Division Net (after-tax) income $635,250 $343,350 Total capital employed 4,600,000 3,575,000 Washington's actual cost of capital was 12%. Required: 1. Calculate the EVA for the Adams Division. If required, enter a negative EVA as a negative number by entering your answer with the minus sign. $ 2. Calculate the EVA for the Jefferson Division. If required, enter a negative EVA as a negative number by entering your answer with the minus sign. $ 3. Conceptual Connection: Is each division creating or destroying wealth? Adams Division Jefferson Division
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