Two companies with different economic-value-added (EVA®) profiles are Carolina Oil Pipe-line, Inc., and Indiana Bank Limited. Adapted versions of the two companies€™ financial statements are presented here (in millions):

Requirements
1. Before performing any calculations, which company do you think represents the better investment? Give your reason.
2. Compute the EVA® for each company, and then decide which company€™s stock you would rather hold as an investment. Assume that both companies€™ cost of capital is 9.5%. (Round your EVA® calculation to the nearest wholenumber.)

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Carolina Oil Pipeline, Inc. Indiana Bank Limited (In millions) Balance sheet data (beginning of year) S 4,353 Interest-bearing debt .S1,246 2,800 307 $14,200 $ 17 2,605 11,578 $14,200 Total assets All other liabilities Stockholders' equity.307 S 4,353 Total liabilities and equity.,3 Income statement data: Total revenue Interest expense Net i $10,807 3,697 S 195 1,496