Casey Motors recently reported the following information:
Net income = $600,000.
Tax rate = 40%.
Interest expense = $200,000.
Operating capital (capital provided by investors) = $9 million.
After-tax cost of capital = 10%.
What is the company’s EVA?
a. ($300,000)
b. ($180,000)
c. $ 0
d. $200,000
e. $400,000
