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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › international enterprises June 2007
Hello, with respect to the above named Question in part b (calculation of eva) why is it that the depreciation was not added back to the NOPAT as is usually done in all EVA calculations ? Thank you
Accounting depreciation should indeed be added back, but we should instead subtract economic deprecation.
There is no choice here but to assume that the two would be the same (because we are not given any information about economic depreciation).
Thanks, clear now.
You are welcome 🙂