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EVA-WACC Tree Model (by Adrián Chiogna).

D:20130916005658ZD:20130915135212-03'00'ImageMagick 6.7.1-6 2012-12-25 Q16 http://www.imagemagick.org6f9bde6f51e839e8917364e1789c2eb6 Income Staterment EVA Sales $1.000 Less: Variable cost of goods sold $ 400 Sales Contribution margin $ 600 $1.000 Less: Factory overhead $ 100 ECONOMIC VALUE ADDED Selling and admin. $ 300 Contribution Value Driver Tree Net operating income (-EBIT) $ 200 S 600 Less: Interest expense $ 200 Net incame before taxes $ 174 Variable Cost Less: Incame taxes $ 70 EBIT of Goods Sold Net income $ 105 $ 200 (Fxed Cast) $ 400 Overhe ad (Before Interest) Operating Profit $ 400 $ 120 Profit Margin (1-Rate of Income Tax) 12.0% 0.6 Current Assets: RONA Sales Cash S I00 Fixed Assets Acpounts Rec. S I0 15.0% $1.000 Mat. Inr. $ I00 $ 600 Operating Profit Total Net Asset Finished Gd. Ine. $ IO0 Turnaver Assets Tetal Car. Arsets $ 400 $ 120 1.25 $ 1.000 Net Assets Fixed Assets EVA Net Assets Current Assets Land $ 100 $ 800 Build, and Egpt. $ 700 $ 42.2 $ 800 $ 400 Cost of Capital Accumtd. Depr. -200 Interest Free Tetal Fixed Assets S 600 $ 77.8 Liabilities WACC Interast Free Liabilities: $ 200 Trade liability $ I00 9.7% Advances received S 50 Accrual for income taxes $50 Interest Free Liabilities $ 200 Product 4 Sales & var. cost of goods sold Product l $ 9 Product 2 Product 3 Product 5 Product 6 Total Dther Imput Data Unit sales price $ 15 $ 20 $ 30 $ 49 $ 59 S 182 Income Taxe Rate 40% $ 5 $ 8 $ 7 Variable manufactoring cost per unit S 14 S ID $ 20 $ 20 Rate of Return of a Market Index 12% $ 4 $ 2 $ 18 $ 10 Contribution margin per unit $6 S 20 $ 29 $39 Risk-Free Rate 7% Expected sales in units $ 3 $4 $5 $6 87 $ 27 Beta Coeficient 1.1 Planned Sales $ 45 S 80 S 150 $ 294 $ 413 S L.00 Before-Tax Cost of Debt 8% $ 24 $ 50 Percentage of Total Capital Supplhed by Equity Percentage of T otal Capital Supplied by Debt Variable manufactoring cost $ 56 $ 120 $ 140 $ 400 60% Contribution margin $ 8 $21 $ 24 S I00 S 174 $ 273 S 600 40% Overhead Selling Overhe ad Administration Dverhead Factory Overhead Total Cost Center | $ 200 $ 200 Cast Center 2 $ 100 Cost Center 3 $ I00 $ IDD Total $ 200 $ 100 $ ID0 $ 400 EVA-Chart Operating Profit - Cost of Capital = EVA = 42,24 16,0% RONA 15 % Operating Profit = 120 14,0% 12,0% 10,0%. WACD 9,72% Cost of Capital 7776 8,0% - 6,0% 40% 2,0% 0,0% 100 200 300 400 500 600 700 800 900 Net Assets Operating Profit Cost of Capital WACC Rate Return of Market Index 12% WEIGHTED AVERAGE COST OF CAPITAL Market Risk Premium Value Driver Tree 5% Company Risk Premium Risk-Free Rate 6% 7% Beta Cost of Cofficient Equity 13% Risk-Free WEIGHTED AVERAGE COST OF CAPITAL Weighted Cost of Equity Rate 7% Percentage of Total Capital 8% 9,7% Supplied by Equity 60% Before-Tax WACC Cost of Debt 9.7% 8% After-Tax Before-Tax Cost of Debt Operating Profit in % 4,8% After-Tax 100% Weighted Cost of Debt Operating Profit in % % of Total 1.9% 60% Capital Supplied by Debt Income Taxe Rate 40,0% 40% (BY ADRIÁN CHIDGNA)

EVA-WACC Tree Model (by Adrián Chiogna).

shared by ADRIANCHIOGNA on Sep 16
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INFOGRAFÍA: EVA-WACC Tree Model© (by Adrián Chiogna) Visualización del proceso de determinación de los coeficientes EVA (Economic Value Added) & WACC (Weighted Average Cost of Capital).

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