The following table gives abbreviated balance sheets and income statements for E

Question

The following table gives abbreviated balance sheets and income statements for Estée Lauder Companies S in millions) End of Year Start of Year Balance Sheet Assets Current assets: Cash and marketable securities Accounts receivable Inventories Other current assets $1,363 936 1,007 503 $1,132 757 838 439 Total current assets Fixed assets Property, plant, and equipment Less accumulated depreciation 3,809 3,166 2,873 1,721 2,536 1,502 Net fixed assets Other long-term assets 1,152 1,455 1,034 1,202 Total assets $6,416 $5,402 Liabilities and Shareholders' Equity Current liabilities Debt due for repayment Accounts payable $ 149 1,816 1,560 Total current liabilities Long-term debt Other long-term liabilities 1,965 1,091 632 1,594 1,216 621 Total liabilities Total shareholders' equity 3,688 2,728 3,431 1,971 Total liabilities and shareholders' equity $6,416 $5,402 Income Statement Net sales Cost of goods sold Selling, general, and administrative expenses Depreciation $8,821 1,948 5,497 309 Earnings before interest and taxes (EBIT) Interest expense 1,067 75 Taxable income Tax 992 Net income 659 Dividends Addition to retained earnings 159 500

Explanation / Answer

Answer:a MVA=Company Market value-Invested capitsl

=(206 million *$51)-$2728 million

=7778 million

Answer:b Market to book ratio=$10506 million/$2728 million=3.85

Answer:c EVA=Net Operating Profit After Taxes (NOPAT) - (Capital * Cost of Capital)

=(1067*(1-0.3357)-(2728*11%)

=708.81-300.08

=$408.7 million

Answer:d Return on capital=($659/2728)*100=24.16%

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