Performance City supplies helicopters to corporate clients.

The company's results for $2020$ are as follows:

Requirement a$.$ What is Performance City's weighted average cost of capital?

Begin by determining the formula to calculate WACC.

After tax cost of debt

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Market value of debt

$+($

$$

Cost of equity

$$

Market value of equity

$=$ WACC

Market value of debt

Market value of equity

$($Enter the amount as a decimal. Round the WACC to five decimal places, in the format X$.$XXXXX$.)$

The company's WACC is

Requirement b$.$ Compute each division's Economic Value Added.

Determine the formula to calculate the EVA of each city. Then enter the amounts for New York and Chicago and calculate the EVA for each. $($Enter the WACC to five decimal places in the format X$.$XXXXX$.$ Round your intermediary calculations to the nearest whole number. Use parentheses or a minus sign when entering a negative EVA. Abbreviation used: inc. $=$ income.$)$

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