Question 4 assignment 2

Economic Value Added Washington Company has two divisions: the Adams Division and the Jefferson Division. The following information pertains to last year's results: Adams Division Jefferson Division Net (after-tax) income $647,350 $378,000 3,737,500 Total capital employed 4,760,000 Washington's actual cost of capital was 11% Required: 1. Calculate the EVA for the Adams Division. If required, enter a negative EVA as a negative number by entering your answer with the minus sign 2. Calculate the EVA for the Jefferson Division. It required, enter a negative EVA as a negative number by entering your answer with the minus sign 3. Conceptual Connection is each division creating or destroying wealth? Adams Division Creating wealth Jefferson Division Destroying wealth