The following information is from the financial statements of Duke Company for the fiscal year just ended:

Total assets $6,000,000

Current liabilities 1,250,000

Operating income 1,140,000

a. Calculate return on investment (ROI).

b. Calculate residual income (RI), assuming the required rate of return is 18%.

c. Calculate economic value added (EVA) assuming (1) Duke has two sources of fundslong-term debt with a market value of $2,500,000 and an interest rate of 10%, and equity capital with a market value of $5,000,000 and a cost of equity of 16%and (2) Dukes income tax rate is 30%.