Question: EVA Versus Economic Profit The primary difference between the EVA and economic profit measures is the increased focus on cash flow by EVA. For example, economic profit generally uses the provision for income taxes from the income statement while EVA uses cash taxes paid. EVA companies typically make several adjustments (from 5 to 15 adjustments for the typical EVA company) to both operating income from the income statement and invested capital from the balance sheet. Common examples include adjustments for R&D, LIFO, and warranty costs. The following data were taken from the 20X3 annual report of Burton Company (thousands of dollars):
Prepare a schedule that calculates and compares EVA to economic profit for Burton Company.