Here are simplified financial statements for Watervan Corporation:

INCOME STATEMENT
(Figures in $ millions)
Net sales	$ 890
Cost of goods sold	750
Depreciation	40
Earnings before interest and taxes (EBIT)	$ 100
Interest expense	21
Income before tax	$ 79
Taxes	25
Net income	$ 54

BALANCE SHEET
(Figures in $ millions)
	End of Year				Start of Year
Assets
Current assets	$	378			$	330
Long-term assets		276				231
Total assets	$	654			$	561
Liabilities and shareholders equity
Current liabilities	$	203			$	166
Long-term debt		117				130
Shareholders equity		334				265
Total liabilities and shareholders equity	$	654			$	561

The companys cost of capital is 8.50%.

a.	Calculate Watervans economic value added (EVA). (Do not round intermediate calculations. Enter your answer in millions rounded to 2 decimal places.)

Economic value added

$ million

b.	What is the companys return on capital? (Use start-of-year rather than average capital.) (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)

Return on capital

%

c.	What is its return on equity? (Use start-of-year rather than average equity.) (Enter your answer as a percent rounded to 2 decimal places.)

Return on equity

%

d.

Is the company creating value for its shareholders?

	Yes
	No