Navarre Energy Research specializes in developing and commercializing new products. It is organized into two divisions, which are based on the products they produce. Canal Division is smaller, and the lives of the products it produces tend to be shorter than those produced by the larger Lake Division. Selected financial data for the past year are shown in the following table. Divisional investment is as of the beginning of the year, Navarre uses an 8 percent cost of capital and beginning of the year investment when computing ROI and residual Income. Ignore Income taxes. Allocated corporate overhead Cost of goods sold Divisional investment R&D Sales Selling, general and administrative (excluding R80) Division Canal (5000) Lake (5000) $ 4,120 20,040 60,500 $ 9,400 29,600 398,000 12,200 31,800 50,800 4,560 190,000 7,800 R&D is assumed to have a three-year life in Canal Division and an eight-year life in Lake Division. All R&D expenditures are spent at the beginning of the year. Assume there are no current liabilities and (unrealistically) that no R&D investments had taken place before this year. Required: a. Compute EVA for the two divisions. Note: Do not round intermediate calculations. Round your final answers to nearest whole dollar amount. Enter your answers in thousands of dollars. Division Allocated corporate overhead Canal ($000) $ 4,120 Cost of goods sold 20,040 Divisional investment 60,500 Lake ($000) $ 9,400 29,600 398,000 R&D 12,200 31,800 Sales 50,800 190,000 Selling, general and administrative (excluding R&D) 4,560 7,800 Answer is complete but not entirely correct. Canal Division Lake Division Economic value added $ 13,173 $ 107,485 x