Your Perfect Assignment is Just a Click Away

Starting at $8.00 per Page

100% Original, Plagiarism Free, Customized to Your instructions!

glass
pen
clip
papers
heaphones

Explain Economic Value Added (EVA) and compute Computron’s EVA if total net operating capital is $25 million?

Explain Economic Value Added (EVA) and compute Computron’s EVA if total net operating capital is $25 million?

Explain Economic Value Added (EVA) and compute Computron’s EVA if total net operating capital is $25 million?

Dilli Bista, MBA is the financial manager for Computron Inc. a large public corporation specializing in software manufacturing. The company designs and develops software programs that allow users to create their own documents, apps, animations, and other media content. Despite a huge investment made last three years in fixed assets, the company’s sales revenue and profit margins have decreased over the years because of the Covid-19 pandemic and complaints of some parents about the effect of video games on their kids’ social life and academic performance. Dilli is analyzing the company’s financial statements and annual reports to determine the financial performance of the company for the year and see how the performance can be improved.

Dilli noticed that last year the company had $4 million in operating income (EBIT). The company had a depreciation expense of $1 million and an interest expense of $1 million. The company’s tax rate is 25%. The company has $14 million in operating current assets and $4 million in operating current liabilities and has $15 million in net plant and equipment. The company has after-tax cost of capital of 10%.

1. List four types of financial statements that the company’s annual report typically include. State three items that can be found in each of the financial statement of Computron Inc.

2. Determine Computron’s net income for the year. Show your calculations.

3. What was Computron’s net cash flow?

4. What was Computron’s net operating profit after taxes (NOPAT)?

5. Calculate net operating working capital and total net operating capital for the year.

6. Calculate Computron’s free cash flow for the year if net operating capital in the previous year was $24 million.

7. Explain to the chairman of the board five uses of free cash flow that can help maximize the value of the firm.

8. Explain Economic Value Added (EVA) and compute Computron’s EVA if total net operating capital is $25 million? The company’s after-tax cost of capital is 10.0%.

9.  Compute and explain market value added (MVA) for Computron using the following information:

            i. total number of shares outstanding is 2 million

            ii.  current stock price is $35 per share

            iii. total common equity is $68.2 million

10. Calculate the company’s return on invested capital (ROIC). Do you think Computron’s growth added value?

Submit your answers in a Word document.


"Place your order now for a similar assignment and have exceptional work written by our team of experts, guaranteeing you A results."

Order Solution Now

Our Service Charter


1. Professional & Expert Writers: Eminence Papers only hires the best. Our writers are specially selected and recruited, after which they undergo further training to perfect their skills for specialization purposes. Moreover, our writers are holders of masters and Ph.D. degrees. They have impressive academic records, besides being native English speakers.

2. Top Quality Papers: Our customers are always guaranteed of papers that exceed their expectations. All our writers have +5 years of experience. This implies that all papers are written by individuals who are experts in their fields. In addition, the quality team reviews all the papers before sending them to the customers.

3. Plagiarism-Free Papers: All papers provided by Eminence Papers are written from scratch. Appropriate referencing and citation of key information are followed. Plagiarism checkers are used by the Quality assurance team and our editors just to double-check that there are no instances of plagiarism.

4. Timely Delivery: Time wasted is equivalent to a failed dedication and commitment. Eminence Papers are known for the timely delivery of any pending customer orders. Customers are well informed of the progress of their papers to ensure they keep track of what the writer is providing before the final draft is sent for grading.

5. Affordable Prices: Our prices are fairly structured to fit in all groups. Any customer willing to place their assignments with us can do so at very affordable prices. In addition, our customers enjoy regular discounts and bonuses.

6. 24/7 Customer Support: At Eminence Papers, we have put in place a team of experts who answer all customer inquiries promptly. The best part is the ever-availability of the team. Customers can make inquiries anytime.