For the company''s shareholders? comment on the implications

Reference no: EM13741943

The CFO of Laidlaw Inc. is wondering how the company is doing in terms of creating value for the company's common shareholders. To answer the question, the CFO wishes to calculate the company's economic value added (EVA) for the most recent fiscal year. The total amount of capital Laidlaw has invested in the business is $5,840,000. Laidlaw's cost of capital is 15.3 percent. During the year, the company's before-tax operating profits were $1,185,000. The firm's tax rate is 32 percent. How has the company done in terms of creating value for the company's shareholders? Comment on the implications of your findings.

Reference no: EM13741943

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