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Calculate the after-tax operating income

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Reference no: EM133063017

Question - Oliver's Olive Company has reported the following financial information for last year:

Sales $5,000,000

Variable costs $3,250,000

Traceable fixed costs $1,000,000

Average invested capital (assets) $6,000,000

Current liabilities $800,000

Required rate of return 12%

Income tax rate 30%

Weighted average cost of capital 10%

Required -

1. Calculate the pre-tax operating income.

2. Calculate the residual income.

3. Calculate the return on investment.

4. Calculate the after-tax operating income.

5. Calculate the economic value added.

Reference no: EM133063017

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