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How to get highlighted answers (Questions 15 and 16) Buckeyes Company's Southern Division earned net income last year as shown in the following income statement:
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(Questions 15 and 16) Buckeyes Company's Southern Division earned net income last year as shown in the following income statement: At the beginning of the year, the value of operating assets was $554,000. At the end of the year, the value of operating assets was $646,000. Total capital employed equaled $580,000. Buckeyes Company has an actual cost of capital is 8% and requires a minimum rate return of 10% 15. What is the residual income for the Southern Division? A. $20,600 B. $38,000 C. $48,000 D. $36,000 16. What is the Economic Value Added (EVA) for the Southern Division? A. $36,000 B. $19,000 C. $20,800 D. $9,000Step by Step Solution
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