Merkel and Markle Technologies: Income Statements for Year Ending December 31 (Thousands of Dollars) 2021 2020 Sales $945,000 $900,000 Expenses excluding depreciation and amortization 812,700 774,000 EBITDA $132,300 $126,000 Depreciation and amortization 33,100 31,500 EBIT $99,200 $94,500 Interest Expense 10,470 8,600 EBT $88,730 $85,900 Taxes (40%) 35,492 34,360 Net income $53,238 $51,540 Common dividends $43,300 $41,230 Addition to retained earnings $9,938 $10,310 Merkel and Markle Technologies: December 31 Balance Sheets (Thousands of Dollars) Assets 2021 2020 Cash and cash equivalents $47,250 $45,000 Short-term investments 3,800 3,600 Accounts Receivable 283,500 270,000 Inventories 141,750 135,000 Total current assets $476,300 $453,600 Net fixed assets 330,750 315,000 Total assets $807,050 $768,600 Liabilities and equity Accounts payable $94,500 $90,000 Accruals 47,250 45,000 Notes payable 26,262 9,000 Total current liabilities $168,012 $144,000 Long-term debt 94,500 90,000 Total liabilities $262,512 $234,000 Common stock 444,600 444,600 Retained Earnings 99,938 90,000 Total common equity $544,538 $534,600 Total liabilities and equity $807,050 $768,600 Key Input Data Tax rate 40% Net operating working capital 2021 NOWC = Operating current assets - Operating current liabilities 2021 NOWC = - 2021 NOWC = 2020 NOWC = Operating current assets - Operating current liabilities 2020 NOWC = - 2020 NOWC = Total net operating capital 2021 TOC = NOWC + Fixed assets 2021 TOC = + 2021 TOC = 2020 TOC = NOWC + Fixed assets 2020 TOC = + 2020 TOC = Investment in total net operating capital 2021 2020 2021 Inv. In TOC = TOC - TOC 2021 Inv. In TOC = - 2021 Inv. In TOC = Net operating profit after taxes 2021 NOPAT = EBIT x ( 1 - T ) 2021 NOPAT = x 2021 NOPAT = Free cash flow 2021 FCF = NOPAT - Net investment in operating capital 2021 FCF = - 2021 FCF = Return on invested capital 2021 ROIC = NOPAT / Total net operating capital 2021 ROIC = / 2021 ROIC = b. Assume that there were 15 million shares outstanding at the end of the year, the year-end closing stock price was $64 per share, and the after-tax cost of capital was 7%. Calculate EVA and MVA for the most recent year. Additional Input Data Stock price per share $64.00 # of shares (in thousands) 15,000 After-tax cost of capital 7.0% Market Value Added MVA = Stock price x # of shares - Total common equity MVA = x - MVA = - MVA = Economic Value Added EVA = NOPAT - (Operating Capital x After-tax cost of capital) EVA = - x EVA = - EVA =