Coldbrook Company Has Two Sources of Funds: Long-Term Debt with a Market

Multiple Choice

Coldbrook Company has two sources of funds: long-term debt with a market and book value of $17,000,000 issued at an interest rate of 11%, and equity capital that has a market value of $3,000,000 (book value of $4,000,000) . Coldbrook Company has profit centers in the following locations with the following operating incomes, total assets, and current liabilities. The cost of equity capital is 15%, while the tax rate is 35%.

What is the EVA® for Bish Bash Falls? (Round intermediary calculations to four decimal places.)

A) $530,400
B) $264,061
C) $266,339
D) $159,638