Question: AwakeCorporation is evaluating an extra dividend versus a share repurchase. In either case, $19,000 would be spent. Current earnings are $1.40 per share, and the
AwakeCorporation is evaluating an extra dividend versus a share repurchase. In either case, $19,000 would be spent. Current earnings are $1.40 per share, and the stock currently sells for $50 per share. There are 5,000 shares outstanding. Ignore taxes and other imperfections.
What will the company's EPS and PE ratio be under these two different scenarios:(Do not round intermediate calculations and round youranswers to 2 decimal places, e.g., 32.16.):
For the extra dividend, what is the EPS and P/E Ratio?
For the repurchase, what is the EPS and P/E Ratio?
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