If net income does not change in for the year ended 10/31/24, what will EPS be for
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Question:
If net income does not change in for the year ended 10/31/24, what will EPS be for the year ended 10/31/24?
What is earnings per share (EPS) prior to the share repurchase?
Acme Co. | ||||||||
Balance Sheet - Before Share Repurchase | ||||||||
10/31/2023 | ||||||||
Current Assets | 26,000 | Current Liabilities | 8,000 | |||||
Long-term Notes payable | 40,000 | |||||||
P P & E, net | 90,000 | Total liabilities | 48,000 | |||||
Total Stockholders' Equity | 68,000 | |||||||
Total Assets | 116,000 | Total liabilities and equity | 116,000 | |||||
Net Income | 5,000 | Year ended 10/31/23 | ||||||
Stock Price | 40.00 | |||||||
Shares Outstanding | 4,000 | Before the share repurchase | ||||||
The company is going to repurchase 1,000 shares on October 31, 2023 | ||||||||
l | They will finance the repurchase by issuing debt at 6% | |||||||
1. | How much debt will they borrow? | |||||||
2. | What will debt to equity be after the share repurchase (round to 1 decimal) | |||||||
3. | How much additional interest expense will the company incur in the next 12 months? | |||||||
4. | How much additional interest expense will the company incur in calendar year 2023? | |||||||
5. |
Related Book For
Financial Accounting
ISBN: 9781618533111
6th Edition
Authors: Michelle L. Hanlon, Robert P. Magee, Glenn M. Pfeiffer, Thomas R. Dyckman
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