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Dec 2007 question 2b) Gamma group eva

YHYee Huey8y ago
Hi sir Need your help in understanding why there were no adjustments for the lease amortization for NOPAT. Is it because the question mentioned it is not subjected to amortization thus should leave it as no adjustments required? Thanks
kengarrettkengarrettTutor8y ago#1
The lease is valued at 16 each year so that is added back to capital employed for both years. There is no depreciation charged so no adjustment is needed by adding back book depreciation for NOPAT. No economic depreciation needs to be taken off NOPAT because the lease is valued at 16 each year.
YHYee Huey8y ago#2
Thanks sir it's clear now to me. Many thanks again for your fast response really helps
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