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Tanzanite Corporation has two sources of funds: long-term debt with a market and book value of $15 million issued at an interest rate of 10%,
Tanzanite Corporation has two sources of funds: long-term debt with a market and book value of $15 million issued at an interest rate of 10%, and equity capital that has a market value of $9 million (book value of $5 million). Tanzanite Corporation has profit centers in the following locations with the following operating incomes, total assets, and current liabilities. The cost of equity capital is 15%, while the tax rate is 30%. Operating Income Bradys Blooming Stratford $ 815,000 $1,100,000 $2,450,000 Assets $3,750,000 Current Liabilities $ 800,000 $ 5,000,000 $9,250,000 $1,200,000 $3,180,000 What is the EVA for Bradys? $255,500 $275,500 $305,000 $338,563
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