Quantitative Problem: Rosnan Industries' 2022 and 2021 balance sheets and income statements are shown below. All of the balance of Cash and Equivalents is an operating asset. Balance Sheets: 2022 2021 Cash and equivalents $ 100 $ 85 Accounts receivable 275 200 Inventories 375 250 Total current assets $ 750 $ 535 Net plant and equipment 2,300 1,590 Total assets $ 3,050 $ 2,125 Accounts payable $ 150 $ 85 Accruals 75 50 Notes payable 150 75 Total current liabilities $ 375 $ 210 Long-term debt 450 290 Common stock 1,225 1,225 Retained earnings 1,000 400 Total common equity $ 2,225 $ 1,625 Total liabilities and equity $ 3,050 $ 2,125 Income Statements: 2022 2021 Sales $ 2,285 $ 1,585 Operating costs excluding depreciation 1,250 1,000 EBITDA $ 1,035 $ 585 Depreciation and amortization 100 75 EBIT $ 935 $ 510 Interest 63 46 EBT $ 872 $ 464 Taxes (25%) 218 116 Net income $ 654 $ 348 Dividends paid $54 $48 Addition to retained earnings $600 $300 Shares outstanding 100 100 Price $24.00 $21.50 WACC 12.00% Using the financial statements above, what is Rosnan's 2022 market value added (MVA)? Do not round intermediate calculations. Round your answer to the nearest dollar. $ Using the financial statements given earlier, what is Rosnan's 2022 economic value added (EVA)? Do not round intermediate calculations. Round your answer to the nearest cent. $

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Question

Quantitative Problem: Rosnan Industries' 2022 and 2021 balance sheets and income statements are shown below. All of the balance of Cash and Equivalents is an operating asset.

Balance Sheets:
	2022		2021
Cash and equivalents	$	100		$	85
Accounts receivable		275			200
Inventories		375			250
Total current assets	$	750		$	535
Net plant and equipment		2,300			1,590
Total assets	$	3,050		$	2,125

Accounts payable	$	150		$	85
Accruals		75			50
Notes payable		150			75
Total current liabilities	$	375		$	210
Long-term debt		450			290
Common stock		1,225			1,225
Retained earnings		1,000			400
Total common equity	$	2,225		$	1,625
Total liabilities and equity	$	3,050		$	2,125

Income Statements:
	2022		2021
Sales	$	2,285		$	1,585
Operating costs excluding depreciation		1,250			1,000
EBITDA	$	1,035		$	585
Depreciation and amortization		100			75
EBIT	$	935		$	510
Interest		63			46
EBT	$	872		$	464
Taxes (25%)		218			116
Net income	$	654		$	348

Dividends paid		$54		$48
Addition to retained earnings		$600		$300

Shares outstanding		100		100
Price	$24.00		$21.50
WACC	12.00%

Using the financial statements above, what is Rosnan's 2022 market value added (MVA)? Do not round intermediate calculations. Round your answer to the nearest dollar.

Using the financial statements given earlier, what is Rosnan's 2022 economic value added (EVA)? Do not round intermediate calculations. Round your answer to the nearest cent.

Expert Solution

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions