Use the following information for Exercises 11-31 and 11-32: Washington Company has two divisions: the Adams Division and the Jefferson Division. The following information pertains to last year's results: Net (after-tax) income Total capital employed Adams Division $ 605,000 4,000,000 Jefferson Division $ 315,000 3,250,000 Washington's actual cost of capital was 12%. OBJECTIVE Exercise 11-31 Economic Value Added Refer to the information for Washington Company above. Required: 1. Calculate the EVA for the Adams Division. 2. Calculate the EVA for the Jefferson Division. 3. CONCEPTUAL CONNECTION Is each division creating or destroying wealth? 4. CONCEPTUAL CONNECTION Describe generally the types of actions that Washington's management team could take to increase Jefferson Division's EVA? OBJECTIVE Exercise 11-32 Residual Income Refer to the information for Washington Company above. In addition, Washington Company's top management has set a minimum acceptable rate of return equal to 8%. Required: 1. Calculate the residual income for the Adams Division. 2. Calculate the residual income for the Jefferson Division