Economic Value Added (EVA) Calculator
Use this calculator to determine the Economic Value Added (EVA) for your business, which helps assess how effectively your company generates profit from its capital. Designed for corporate finance professionals, this tool aids in making informed financial decisions.
Calculator
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Data Source and Methodology
All calculations are strictly based on standardized corporate finance formulas and data from authoritative financial sources.
The Formula Explained
\( \text{EVA} = \text{NOPAT} - (\text{Capital Invested} \times \text{WACC}) \)
Glossary of Terms
- NOPAT: Net Operating Profit After Taxes.
- WACC: Weighted Average Cost of Capital, expressed in percentage.
- Capital Invested: The total capital invested in the business.
FAQs
What is Economic Value Added (EVA)?
EVA is a measure of a company's financial performance based on residual wealth, calculated by deducting the cost of capital from its operating profit.
How can EVA be used in decision making?
EVA helps managers determine if a company is truly creating value for its shareholders and can guide investment and operational decisions.