Part I. East Valley Manufacturing had gross profit of $450000 and selling &

Part I.

East Valley Manufacturing had gross profit of $450000 and selling & administrative expenses of $275000 last year. The company also began
last year with $1800000 of operating assets and ended the year with $1500000 of operating assets.

Calculate Return on Investment for East Valley Manufacturing.

Part II.

Saguaro Boat Engines had sales of $6400000 cost of goods sold of $4.8 million and selling & administrative expenses of $650000 for
its most recent year of operation. The company%u2019s tax rate is 40%. The total Capital Employed by the firm is $5000000. The following information is also
available.

Debt/Stock Int Rate

Long-Term Debt $1000000 12%

Common Stock $3000000 8%

1.In good order and form prepare an income statement for Saguaro.

2.Calculate EVA.