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Universal Electronics, Inc. (UE), which started operations one year ago, has two divisions: Consumer and Commercial. Both divisions invest heavily in R&D, which is assumed
Universal Electronics, Inc. (UE), which started operations one year ago, has two divisions: Consumer and Commercial. Both divisions invest heavily in R&D, which is assumed to benefit five years. R&D spending is made uniformly throughout the year. UEI has a cost of capital of 11 percent. Selected financial information for the two divisions (in thousands of dollars) for the year just completed follows. Sales revenue Consumer $30,000 Commercial Divisional income Divisional investment Current liabilities. R&D $49,000 5,400 5,535 29,500 30,750 1,800 1,600. 1,800 1,800 Required: Evaluate the performance of the two divisions assuming UEI uses economic value added (EVA). (Enter your answers in thousands of dollars rounded to 1 decimal place.) EVA of Consumer division i EVA of Commercial division Which division performed better
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