Return 11 Here are simplified financial statements for Watervan Corporation: INCOME STATEMENT (Figures in $ millions) 10 Net sales $ 881 points Cost of goods sold 741 Depreciation 31 Earnings before interest and taxes (EBIT) $ 109 Interest expense 12 Income before tax $ 97 Taxes 20 Net income $ 77 BALANCE SHEET (Figures in $ millions) Start End of of Year Year Assets Current assets $ 369 $ 312 Long-term assets 258 222 Total assets $ 627 $ 534 Liabilities and shareholders' equity Current liabilities $ 194 $ 157 Long-term debt 108 121 Shareholders' equity 325 256 Total liabilities and shareholders' equity $ 627 $ 534 The company's cost of capital is 8.5%.The company's cost of capital is 8.5%. Required: a. Calculate Watervan's economic value added (EVA). (Do not round intermediate calculations. Enter your answer in millions rounded to 2 decimal places.) b. What is the company's return on capital? (Use start-of-year rather than average capital.) (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) c. What is its return on equity? (Use start-of-year rather than average equity.) (Enter your answer as a percent rounded to 2 decimal places.) d. Is the company creating value for its shareholders? X Answer is complete but not entirely correct. a. Economic value added EA 44.47 X million b. Return on capital 19.70 X % C. Return on equity 22.87 X % d. Is the company creating value for its shareholders? Yes