Quantitative Problem: Rosnan Industries' 2018 and 2017 balance sheets and income statements are shown below. All of the balance of Cash and Equivalents is an operating asset.

Balance Sheets:
	2018	2017
Cash and equivalents	$100	$85
Accounts receivable	275	200
Inventories	375	250
Total current assets	$750	$635
Net plant and equipment	2,000	1,490
Total assets	$2,750	$2,125
Accounts payable	$150	$85
Accruals	75	50
Notes payable	150	75
Total current liabilities	$375	$210
Long-term debt	450	290
Common stock	1,225	1,225
Retained earnings	700	400
Total liabilities and equity	$2,750	$2,125

Income Statements:
	2018	2017
Sales	$2,000	$1,500
Operating costs excluding depreciation	1,250	1,000
EBITDA	$750	$500
Depreciation and amortization	100	75
EBIT	$650	$425
Interest	62	45
EBT	$588	$380
Taxes (40%)	235	152
Net income	$353	$228
Dividends paid	$53	$48
Addition to retained earnings	$300	$180
Shares outstanding	170	170
Price	$31.25	$28.75
WACC	8.00%

Using the financial statements above, what is Rosnan's 2018 market value added (MVA)? Do not round intermediate calculations. Round your answer to the nearest dollar. $

Using the financial statements given earlier, what is Rosnan's 2018 economic value added (EVA)? Do not round intermediate calculations. Round your answer to the nearest cent.

2.

The Morris Corporation has $400,000 of debt outstanding, and it pays an interest rate of 8% annually. Morris's annual sales are $2 million, its average tax rate is 40%, and its net profit margin on sales is 4%. If the company does not maintain a TIE ratio of at least 3 to 1, then its bank will refuse to renew the loan, and bankruptcy will result. What is Morris's TIE ratio? Do not round intermediate calculations. Round your answer to two decimal places.