Back Mountain Industries (BMI) has two divisions: East and West. BMI has a cost of...
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Back Mountain Industries (BMI) has two divisions: East and West. BMI has a cost of capital of 25 percent. Selected financial information (in thousands of dollars) for the first year of business follows Sales revenue $5,000 $9,000 990 2,000 4,000 400 ,500 1,400 Income 900 Investment (beginning of year Current liabilities (beginning of year) 400 R&D expenditures R&D is assumed to benefit two periods. All R&D is spent at the beginning of the year Required a-1. Evaluate the performance of the two divisions assuming BMI uses economic value added. (Enter answers in thousands of dollars. Round your answers to 1 decimal place.) Divisions EVA East West a-2. Which division had the better performance? East West
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