Falconer company had net (after-tax) income last year of $14,107,956 and total capital employed of $131,869,720. falconer's actual cost of capital was 12%.
required:
1. calculate the eva for falconer company. enter negative values as negative numbers, if required. round your answer to the nearest dollar. $
2. conceptual connection: is falconer creating or destroying wealth?

1. -$1,716,410.40

2. destroying wealth

Explanation:

The formula to compute EVA is shown below:

1. = Net operating income or earnings after taxes - (total capital employed × actual cost of capital)

= $14,107,956 - ($131,869,720 × 12%)

= $14,107,956 - $15,824,366.40

= -$1,716,410.40

2. As we see that the amount comes in negative that represent the wealth is destroyed

answer: heh

explanation:

the answer would be voluntary exchange -

"the act of buyers and sellers freely and willingly engaging in market transactions. moreover, transactions are made in such a way that both the buyer and the seller are better off after the exchange than before it occurred."

hope this : )

-shy