Home Depot entered fiscal 2017 with a total capitalization of $21,907 million. In 2017, debt investors...
Home Depot entered fiscal 2017 with a total capitalization of $21,907 million. In 2017, debt investors received interest income of $878 million. Net income to shareholders was $8,657 million. (Assume a tax rate of 21 %.)
Calculate the economic value added assuming its cost of capital is 10%.
Homework Answers
EVA is the additional income over and above what is required by Equity and Bondholder.
EVA = (Equity Earnings + After debt Earnings) - Total Capitalization * Cost of Capital
= (8675 + 878(1-0.21)) - 21907 * 10%
= 9368.62 - 2190.7
= $7177.92 mn
NOTE: The answer to your question has been given below/above. If there is any query regarding the answer, please ask in the comment section. If you find the answer helpful, do upvote. Help us help you.
Add Answer to:
Home Depot entered fiscal 2017 with a total capitalization of
$21,907 million. In 2017, debt investors...
Home Depot entered fiscal 2017 with a total capitalization of $21,895 million. In 2017, debt investors...
Home Depot entered fiscal 2017 with a total capitalization of $21,895 million. In 2017, debt investors received interest income of $874 million. Net income to shareholders was $8,645 million. (Assume a tax rate of 21%.) Calculate the economic value added assuming its cost of capital is 10%. (Do not round intermediate calculations. Enter your answer in millions rounded to 2 decimal places.)
Home Depot entered fiscal 2017 with a total capitalization of $21,886 million. In 2017, debt investors...
Home Depot entered fiscal 2017 with a total capitalization of $21,886 million. In 2017, debt investors received interest income of $871 million. Net income to shareholders was $8,636 million. (Assume a tax rate of 21%.) Calculate the economic value added assuming its cost of capital is 10%. (Do not round intermediate calculations. Enter your answer in millions rounded to 2 decimal places.)
Home Depot entered fiscal 2016 with a total capitalization of $27,252 million. In 2016, debt investors...
Home Depot entered fiscal 2016 with a total capitalization of $27,252 million. In 2016, debt investors received interest income of $843 million. Net income to shareholders was $6,384 million. (Assume a tax rate of 35%.) Calculate the economic value added assuming its cost of capital is 10%. (Do not round intermediate calculations. Enter your answer in millions rounded to 2 decimal places.)
Home Depot entered fiscal 2016 with a total capitalization of $27.273 millon In 2016, debt investors...
Home Depot entered fiscal 2016 with a total capitalization of $27.273 millon In 2016, debt investors received interest income of $850 million. Net income to shareholders was $6.405 million. (Assume a tax rate of 35%) Calculate the economic value added assuming its cost of capital is 10%. (Do not round intermediate calculations. Enter your answer in millions rounded to 2 decimal places.) Economic value added million
Here is a simplified balance sheet for Locust Farming: Current assets Long-term assets Locust Farming Balance...
Here is a simplified balance sheet for Locust Farming: Current assets Long-term assets Locust Farming Balance Sheet ($ in millions) $ 42,534 Current liabilities 46,852 Long-term debt Other liabilities Equity $ 89,386 Total $ 29,745 27,762 14,337 17,542 $ 89,386 Total Locust has 667 million shares outstanding with a market price of $93 a share. a. Calculate the company's market value added. (Enter your answers in millions.) Market value million Market value added million b. Calculate the market-to-book ratio. (Round...
Refer to the financial statements of The Home Depot in Appendix A. (Note: Fiscal 2016 for...
Refer to the financial statements of The Home Depot in Appendix
A. (Note: Fiscal 2016 for The Home Depot runs from February 1,
2016, to January 29, 2017. As with many retail companies, The Home
Depot labels the period “Fiscal 2016” even though it ends in the
2017 calendar year. The label “Fiscal 2016” is appropriate because
Fiscal 2016 includes 11 months from the 2016 calendar year. The
Home Depot explains its choice of fiscal period in Note 1 to...
SOURCES AND USES FOR HOME DEPOT 2017: Beginning Cash 2,538 HOME DEPOT Income Statement Revenue Cost...
SOURCES AND USES FOR HOME DEPOT 2017:
Beginning Cash 2,538 HOME DEPOT Income Statement Revenue Cost of Revenue Gross Profit Operating expenses Depreciation expense Earnings Before Interest & Tax Non-operating Inc(Expn) Interest Earnings Before Tax Income Tax Expense Net Income CY 2017 100,904 66,548 34,356 17,613 2,062 14,681 74 Cash Flow - Operating Activities Net Income Depreciation Change in: Accts Receivable Inventory Other Curr Assets Accts Payable Other Curr Liabs Subtotal - CF Operating 1,057 13,698 5,068 8,630 Balance Sheet...
Refer to the financial statements of The Home Depot in Appendix A. (Note: Fiscal 2016 for...
Refer to the financial statements of The Home Depot in Appendix A. (Note: Fiscal 2016 for The Home Depot runs from February 1, 2016, to January 29, 2017 Required: 1. What amount of Net Sales does the company report during the year ended January 29, 2017? $32,313 $62,282 $7,957 $94,595 2. Assuming that Cost of Sales is the company's term for Cost of Goods Sold, compute the company's gross profit percentage for fiscal 2016 and the year immediately prior to...
Based on the financial statements of Home Depot for the fiscal year that ended February 3,...
Based on the financial statements of Home Depot for the fiscal year that ended February 3, 2019, calculate the following ratios for the last two fiscal years: Net Working Capital The risk that interest rates will increase, and that increase will lead to a decline in the prices of outstanding bonds, 13 called "interest rate risk," or "interest rate price risk." True False
You have the following data on The Home Depot, Inc. Market value of long-term debt: $20,888...
You have the following data on The Home Depot, Inc. Market value of long-term debt: $20,888 million Market value of common stock: $171,138 million Beta: 1.04 Yield to maturity on debt with 10 years to maturity: 2.167% Expected return on equity: 8.076% Marginal tax rate: 35% Assume that if Home Depot issues new bonds, the bonds will have 10 years to maturity. Suppose that managers at Home Depot decide to increase the proportion of debt to 20% of the value...
Home Depot entered fiscal 2016 with a total capitalization of $27.273 millon In 2016, debt investors received interest income of $850 million. Net income to shareholders was $6.405 million. (Assume a tax rate of 35%) Calculate the economic value added assuming its cost of capital is 10%. (Do not round intermediate calculations. Enter your answer in millions rounded to 2 decimal places.) Economic value added million
Here is a simplified balance sheet for Locust Farming: Current assets Long-term assets Locust Farming Balance Sheet ($ in millions) $ 42,534 Current liabilities 46,852 Long-term debt Other liabilities Equity $ 89,386 Total $ 29,745 27,762 14,337 17,542 $ 89,386 Total Locust has 667 million shares outstanding with a market price of $93 a share. a. Calculate the company's market value added. (Enter your answers in millions.) Market value million Market value added million b. Calculate the market-to-book ratio. (Round...
Refer to the financial statements of The Home Depot in Appendix
A. (Note: Fiscal 2016 for The Home Depot runs from February 1,
2016, to January 29, 2017. As with many retail companies, The Home
Depot labels the period “Fiscal 2016” even though it ends in the
2017 calendar year. The label “Fiscal 2016” is appropriate because
Fiscal 2016 includes 11 months from the 2016 calendar year. The
Home Depot explains its choice of fiscal period in Note 1 to...
SOURCES AND USES FOR HOME DEPOT 2017:
Beginning Cash 2,538 HOME DEPOT Income Statement Revenue Cost of Revenue Gross Profit Operating expenses Depreciation expense Earnings Before Interest & Tax Non-operating Inc(Expn) Interest Earnings Before Tax Income Tax Expense Net Income CY 2017 100,904 66,548 34,356 17,613 2,062 14,681 74 Cash Flow - Operating Activities Net Income Depreciation Change in: Accts Receivable Inventory Other Curr Assets Accts Payable Other Curr Liabs Subtotal - CF Operating 1,057 13,698 5,068 8,630 Balance Sheet...
Refer to the financial statements of The Home Depot in Appendix A. (Note: Fiscal 2016 for The Home Depot runs from February 1, 2016, to January 29, 2017 Required: 1. What amount of Net Sales does the company report during the year ended January 29, 2017? $32,313 $62,282 $7,957 $94,595 2. Assuming that Cost of Sales is the company's term for Cost of Goods Sold, compute the company's gross profit percentage for fiscal 2016 and the year immediately prior to...
Based on the financial statements of Home Depot for the fiscal year that ended February 3, 2019, calculate the following ratios for the last two fiscal years: Net Working Capital The risk that interest rates will increase, and that increase will lead to a decline in the prices of outstanding bonds, 13 called "interest rate risk," or "interest rate price risk." True False
You have the following data on The Home Depot, Inc. Market value of long-term debt: $20,888 million Market value of common stock: $171,138 million Beta: 1.04 Yield to maturity on debt with 10 years to maturity: 2.167% Expected return on equity: 8.076% Marginal tax rate: 35% Assume that if Home Depot issues new bonds, the bonds will have 10 years to maturity. Suppose that managers at Home Depot decide to increase the proportion of debt to 20% of the value...
Most questions answered within 3 hours.
-
Create a class called Hotel. The hotel class will track the
current reservations for your one-room...
asked 6 minutes ago -
In space, a 4.0 kg metal ball moving 30 m/s has a head on
collision with...
asked 16 minutes ago -
Financial Markets and Corporate Strategy (assignment template) –
1 of 2
Insights/Instructions: Use this template to...
asked 13 minutes ago -
A firm has announced a cash dividend of $3 dollar per share.
Assuming an efficient market,...
asked 9 minutes ago -
Which of the following statements is consistent with the fact
that capital in an economy is...
asked 23 minutes ago -
Would you hire a white hat hacker or black hat hacker? What are
the pros and...
asked 28 minutes ago -
The CFO is conducting a meeting and she says "we shouldn't
accept this project because we...
asked 30 minutes ago -
How do you obtain the discount rate for an international capital
budgeting problem?
asked 27 minutes ago -
Hi, please read the entire problem.
I need help with the BusOrder class and test for...
asked 28 minutes ago -
Hello, regarding the photoelectric effect I had a couple
questions:
Red light is shining on a...
asked 45 minutes ago -
build a sample navigation Sprite in css ?
asked 43 minutes ago -
Please write a C# program for an concert sale with the
requirements below in Console Form:...
asked 46 minutes ago