Evaluate the two divisions in terms of economic value added

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Reference no: EM13583029

Spectrum Book Company has two divisions: The Brick and Mortar division sells books through more than 100 bookstores throughout the United States; the Internet division was formed 18 months ago and sells books via the Internet. Data for the past year are:

	Brick and Mortar Division	Internet Division
Total assets	$162,700,000	$15,520,000
Noninterest-bearing current liabilities	7,071,000	2,534,000
Net income (loss)	27,720,000	(1,138,000	)
Interest expense	1,275,000	411,100
Tax rate	40%	0
Cost of capital	10%	12%

Evaluate the two divisions in terms of economic value added (EVA). (Enter negative answers preceeding either - sign, e.g. -45 or in parentheses, e.g. (45).)

		Brick & Mortar Division		Internet Division
EVA		$		$

Reference no: EM13583029

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