Lauderdale Corporation is organized in three geographical divisions (regions) with managers responsible for revenues, costs, and assets in their respective regions. The firm is highly decentralized and managers are evaluated solely on divisional performance. corporate overhead (all fixed) is allocated to the regions based on regional gross margin (regional revenue minus regional cost of sales). The following information is from Lauderdale's first year of operations: Information on the division assets in the three regions of Lauderdale Corporation follows: Lauderdale Corporation has a cost of capital of 8.6 percent. The individual regions are responsible for research and development (R\&D) decisions and for current liabilities. Information on R\&O expenditures (which are included in SG\&A) for the year and current liabilities for the three regions follows: RSD expenditures Current liabilities R\&D expenditures are assumed to be incurred uniformly over the period and are expected to generate benefits for three years. Required: a. Compute economic value added for the three regions. Ignore taxes. b. How have these regions performed? Complete this question by entering your answers in the tabs below. Compute economic value added for the three regions. Ignore taxes. Note: Do not round your intermediate calculations. How have these regions performed? 1a. Based on EVA, which region performed the best? 1b. Based on EVA, which region performed the worst? Lauderdale Corporation is organized in three geographical divisions (regions) with managers responsible for revenues, costs, and assets in their respective regions. The firm is highly decentralized and managers are evaluated solely on divisional performance. corporate overhead (all fixed) is allocated to the regions based on regional gross margin (regional revenue minus regional cost of sales). The following information is from Lauderdale's first year of operations: Information on the division assets in the three regions of Lauderdale Corporation follows: Lauderdale Corporation has a cost of capital of 8.6 percent. The individual regions are responsible for research and development (R\&D) decisions and for current liabilities. Information on R\&O expenditures (which are included in SG\&A) for the year and current liabilities for the three regions follows: RSD expenditures Current liabilities R\&D expenditures are assumed to be incurred uniformly over the period and are expected to generate benefits for three years. Required: a. Compute economic value added for the three regions. Ignore taxes. b. How have these regions performed? Complete this question by entering your answers in the tabs below. Compute economic value added for the three regions. Ignore taxes. Note: Do not round your intermediate calculations. How have these regions performed? 1a. Based on EVA, which region performed the best? 1b. Based on EVA, which region performed the worst
