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Cornerstones of Managerial Accounting 4th Edition by Maryanne Mowen, Don Hansen, Dan Heitger
Edition 4ISBN: 978-0324380767Cornerstones of Managerial Accounting 4th Edition by Maryanne Mowen, Don Hansen, Dan Heitger
Edition 4ISBN: 978-0324380767 Exercise 53
The key difference between residual income and EVA is that EVA
A) uses the actual cost of capital for the company rather than a minimum required cost of capital.
B) uses the minimum required cost of capital for a company rather than the actual percentage cost of capital.
C) is a ratio rather than an absolute dollar amount.
D) cannot be negative.
E) There is no difference between residual income and EVA.
A) uses the actual cost of capital for the company rather than a minimum required cost of capital.
B) uses the minimum required cost of capital for a company rather than the actual percentage cost of capital.
C) is a ratio rather than an absolute dollar amount.
D) cannot be negative.
E) There is no difference between residual income and EVA.
Explanation
Verified
Verified
The answer is 'a'.
Residual income:
• ...
Cornerstones of Managerial Accounting 4th Edition by Maryanne Mowen, Don Hansen, Dan Heitger
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