Consider the financial statement data and stock price data for Mydeco Corp. Suppose Mydeco repurchases 2.5 million shares each year from 2015 to 2018. What would be its eamings per share in 2018? (Assume Mydeco pays for the shares using its available cash and that Mydeco earns no interest on its cash balances.) Click the icon to view the financial statement and stock price data. (Select the best choice below.) A. A repurchase does not impact earnings directly, so any change to EPS will come from an increase in shares outstanding. 2018 shares outstanding = 56.6 million + 4 x 2.5 million = 54.1 million, EPS = $23.1 million/54.1 million = $0.43. B. A repurchase does not impact earnings directly, so any change to EPS will come from a reduction in shares outstanding. 2018 shares outstanding = 56.6 million - 4x 2.5 million = 46.6 million, EPS = $23.1 million / 46.6 million = $0.50. C. A repurchase does not impact earnings dilectly, so any change to EPS will come from a reduction in shares outstanding. 2018 shares outstanding = 56.6 million - 4 x 2.5 million = 46.6 million, EPS = $14.1 million/46.6 million = $0.30. D. A repurchase does not impact earnings directly, so any change to EPS will come from an increase in shares outstanding. 2018 shares outstanding = 56.6 million + 4 x 2.5 million = 54.1 million, EPS = $14.1 million / 54.1 million = $0.26. Question Hala i Data Table 2014-2018 Financial Statement Data and Stock Price Data for Mydeco Corp. (All data as of fiscal year end; in $ millions) Income Statement 2014 2015 2016 2017 Revenue 408.1 362.2 423.5 508.6 Cost of Goods Sold (190.8) (173.3) (211.1) (242.8) Gross Profit 217.3 188.9 212.4 265.8 Sales and Marketing (68.1) (65.2) (83.7) (101.0) Administration (59.8) (58.1) 61.4) (67.8) Depreciation & Amortization (29.0) (25.8) (32.3) (38.2) EBIT 60.4 39.8 35.0 58.8 Interest Income (Expense) (34.9) (34.1) (32.1) (37.1) Pretax Income 25.5 5.7 2.9 21.7 Income Tax (8.9) (2.0) (1.0) (7.6) Net Income 16.6 3.7 1.9 14.1 Shares Outstanding (millions) 56.6 56.6 56.6 56.6 Earnings per Share $0.29 $0.07 $0.03 $0.25 Balance Sheet 2014 2015 2016 2017 Assets 46.9 69.3 85.8 Cash 75.1 88.6 71.5 68.4 76.2 Accounts Receivable 34.2 29.2 27.7 30.8 Inventory 170.0 181.9 182.1 169.7 Total Current Assets 243 2 2418 34A 5 3114 Net Property Plant & Fouinment 2018 607.1 (296.4) 310.7 (119.8) (78.9) (38.5) 73.5 (37.9) 35.6 (12.5) 23.1 56.6 $0.41 2018 83.6 85.3 33.7 202.6 3518 2014 2015 2016 2017 2018 46.9 88.6 34.2 169.7 243.2 360.2 773.1 69.3 71.5 29.2 170.0 241.8 360.2 772.0 85.8 68.4 27.7 181.9 311.4 360.2 853.5 75.1 76.2 30.8 182.1 348.5 360.2 890.8 83.6 85.3 33.7 202.6 351.8 360.2 914.6 Balance Sheet Assets Cash Accounts Receivable Inventory Total Current Assets Net Property, Plant & Equipment Goodwill & Intangibles Total Assets Liabilities & Stockholders' Equity Accounts Payable Accrued Compensation Total Current Liabilities Long-Term Debt Total Liabilities Stockholders' Equity Total Liabilities & Stockholders' Equity Statement of Cash Flows Net Income Depreciation & Amortization Change in Accounts Receivable Channin lauantas 16.9 7.5 24.4 504.9 529.3 243.8 773.1 18.3 6.5 24.8 504.9 529.7 242.3 772.0 20.2 7. 27.5 581.0 608.5 245.0 853.5 26.5 7.8 34.3 604.7 639.0 251.8 890.8 30.9 8.7 39.6 604.7 644.3 270.3 914.6 2015 2016 3.7 2014 16.6 29.0 3.9 2017 14.1 38.2 (7.8) 194 1.9 32.3 3.1 2018 23.1 38.5 (9.1) 25.8 17.1 4E 7.5 24.4 504.9 529.3 243.8 773.1 6.5 24.8 504.9 529.7 242.3 772.0 7.3 27.5 581.0 608.5 245.0 853.5 7.8 34.3 604.7 639.0 251.8 890.8 8.7 39.6 604.7 644.3 270.3 914.6 Accrued Compensation Total Current Liabilities Long-Term Debt Total Liabilities Stockholders' Equity Total Liabilities & Stockholders' Equity Statement of Cash Flows Net Income Depreciation & Amortization Change in Accounts Receivable Change in Inventory Change in Pay. & Accrued Comp. Cash from Operations Capital Expenditures Cash from Investing Activ. Dividends Paid Sale (or Purchase) of Stock Debt Issuance (Pay Down) Cash from Financing Activ. Change in Cash Mydeco Stock Price 2014 16.6 29.0 3.9 (2.9) 1.9 48.5 (25.3) (25.3) (5.7) 2015 3.7 25.8 17.1 5.0 0.4 52.0 (23.9) (23.9) (5.7) 2014 1.9 32.3 3.1 1.5 2.7 41.5 (95.4) (95.4) (5.7) 2017 14.1 38.2 (7.8) (3.1) 6.8 48.2 (76.9) (76.9) (5.7) 2018 23.1 38.5 (9.1) (2.9) 5.3 54.9 (40.0) (40.0) (6.4) (5.7) 17.5 $8.08 (5.7) 22.4 $3.31 76.1 70.4 16.5 $4.42 23.7 18.0 (10.7) $8.56 (6.4) 8.5 $10.54