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Worldatwork c8 Exam - Topic 3 Question 63 Discussion

The XYZ Company opened a new manufacturing facility with a capital investment of 10,000,000. The cost to obtain the capital was 8%. In its first year of operations, the facility's net operating profit after taxes was 10,500,000. What was the economic value added (EVA) using the EVA formula?
D) 9,700,000
A) 500,000
B) 840,000
C) 8,000,000

Worldatwork c8 Exam - Topic 3 Question 63 Discussion

Actual exam question for Worldatwork's c8 exam
Question #: 63
Topic #: 3
[All c8 Questions]

The XYZ Company opened a new manufacturing facility with a capital investment of 10,000,000. The cost to obtain the capital was 8%. In its first year of operations, the facility's net operating profit after taxes was 10,500,000. What was the economic value added (EVA) using the EVA formula?

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Suggested Answer: D

by Margart at Feb 07, 2024, 03:35 PM

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Muriel
8 months ago
10,500,000 profit seems too good for a first year, right?
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Markus
8 months ago
Definitely A, the math checks out!
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Jutta
8 months ago
Wait, how can the EVA be that high?
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Kanisha
9 months ago
I think it’s B, sounds right to me!
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Paris
9 months ago
EVA is calculated as net profit minus capital charge.
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Krystina
9 months ago
I feel like I might be mixing up the numbers. Was it 10 million or 10.5 million for the profit? I hope I remember the right figures!
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Novella
9 months ago
I practiced a similar question last week, and I think the EVA was around 500,000. I just need to double-check my calculations to be sure.
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Celestine
10 months ago
I think the capital charge is the investment multiplied by the cost of capital, which would be 10 million times 8%. That should help with the calculation.
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Michal
10 months ago
I remember the EVA formula is net operating profit after taxes minus the capital charge. But I'm not sure how to calculate the capital charge exactly.
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Wilbert
10 months ago
Wait, what's the cost of capital again? I want to make sure I have all the right inputs for the calculation.
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Paulina
10 months ago
No problem, I've done plenty of these types of questions before. I'm confident I can get the right answer.
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Lizette
10 months ago
I'm a little confused by the concept of economic value added. Can someone explain that to me again?
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Allene
10 months ago
Okay, I think I've got this. Let me just double-check the numbers and plug them into the formula.
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Carin
10 months ago
Hmm, this looks like a tricky one. I'll need to carefully work through the EVA formula to figure this out.
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Sabina
10 months ago
This is a classic SSH and file retrieval task. I'll confidently use the provided credentials to connect to the machine, then quickly locate and read the contents of the flag.txt file. I've got this!
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Bronwyn
10 months ago
Okay, let's think this through. The question is asking about the Kubernetes platform choice, and it specifically mentions using VMware vSAN for storage. That suggests VMware Tanzu Kubernetes Grid would be the best fit, as it's designed for running Kubernetes on VMware infrastructure.
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Lucina
10 months ago
Hmm, I'm a bit unsure about this one. I know SSL/TLS is important for secure database connections, but I'm not too familiar with the specific --ssl-mode options. I'll need to review those before attempting this.
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Vallie
2 years ago
That would be 10,500,000 - 800,000 = 9,700,000. So, my answer is D) 9,700,000.
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Samira
2 years ago
Yes, that's correct. So, it would be 10,500,000 - (10,000,000 * 8%) = EVA.
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Marjory
2 years ago
I think the EVA formula includes subtracting the cost of capital from the net operating profit after taxes.
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Roy
2 years ago
Candidate 1: It's interesting to see different perspectives on this question, I guess we'll have to go with our best judgement during the exam.
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Audra
2 years ago
Candidate 2: I understand where you're coming from, but I still think option B) 840,000 is the most accurate answer based on the formula.
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Jospeh
2 years ago
Candidate 4: I'm leaning towards option A) 500,000 as well, it seems to make sense given the numbers provided.
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Dominque
2 years ago
Candidate 3: I see your point, but I think the EVA would actually be 9,700,000 considering the capital investment and the profit generated.
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Alline
2 years ago
Candidate 2: I disagree, I believe the EVA would be 840,000 because the net operating profit after taxes was higher than the cost of capital.
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Azzie
2 years ago
Candidate 1: I think the economic value added (EVA) would be 500,000 based on the EVA formula.
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