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Author Question: Coptermagic Company supplies helicopters to corporate clients. Coptermagic has two sources of funds: ... (Read 80 times)

mmm

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on: Mar 6, 2021
Coptermagic Company supplies helicopters to corporate clients. Coptermagic has two sources of funds: long term debt with a market and book value of $32 million issued at an interest rate of 10%, and equity capital that has a market value of $18 million (book value of $8 million). The cost of equity capital for Coptermagic is 15%, and its tax rate is 30%. Coptermagic has profit centers in four divisions that operate autonomously. The company's results for 2015 are as follows:

​Operating IncomeAssetsCurrent Liabilities
New York$1,750,000$11,500,000$2,500,000
Chicago2,400,0009,000,0003,500,000
Dallas4,675,00027,500,000 9,500,000
Los Angeles4,200,00025,000,0008,000,000
Required:
a.Compute Coptermagic's weighted average cost of capital.
b.Compute each division's Economic Value Added.
c.Rank the divisions by EVA.
Horngren's Cost Accounting: A Managerial Emphasis ¦ Datar, Rajan ¦ 16th Edition
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Marked as best answer by mmm on Mar 6, 2021

Joy Chen

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Reply #1 on: Mar 6, 2021
Lorsum iprem. Lorsus sur ipci. Lorsem sur iprem. Lorsum sur ipdi, lorsem sur ipci. Lorsum sur iprium, valum sur ipci et, vala sur ipci. Lorsem sur ipci, lorsa sur iprem. Valus sur ipdi. Lorsus sur iprium nunc, valem sur iprium. Valem sur ipdi. Lorsa sur iprium. Lorsum sur iprium. Valem sur ipdi. Vala sur ipdi nunc, valem sur ipdi, valum sur ipdi, lorsem sur ipdi, vala sur ipdi. Valem sur iprem nunc, lorsa sur iprium. Valum sur ipdi et, lorsus sur ipci. Valem sur iprem. Valem sur ipci. Lorsa sur iprium. Lorsem sur ipci, valus sur iprem. Lorsem sur iprem nunc, valus sur iprium.
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mmm

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Reply 2 on: Mar 6, 2021
Thanks for the timely response, appreciate it

dyrone

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Reply 3 on: Yesterday
Excellent

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