Hi forum!
I’m confused: Why is NOPAT/ASSETS compared to WACC in PP5 of Reading 36?
My solution would have been: Residual Income = NOPAT - Equity charge = 10mn - 0,5 * 100mn * 0,12 = 4m (but according to the given solution above, Residual Income = 1.3mn (= 100mn * (0.10-0.087) )
Thanks, guys!