Which of the following items would not require an adjustment to capital employed when using economic value added (EVA)?
A)Research & development costs
B)Advertising expenditures
C)Preferred stock
D)Patents developed

Question

Quizplus · Accepted Answer

Preferred stock is considered a source of financing, not an element of capital employed, and therefore does not require an adjustment to EVA. Research & development costs, advertising expenditures, and patents developed are all considered investments in the business and would require adjustments to capital employed when using EVA.

Which of the Following Items Would Not Require an Adjustment