Solve the problem using excel formula

A B C D E F G H K L M N P-19: Dilution and rates of return (LO15-3) The Presley Corporation is about to go public. It currently has aftertax earnings of $7,200,000, and 2,100,000 shares are owned by the present stockholders (the Presley family). The new public issue will represent 800,000 new shares. The new shares will be priced to the public at $25 per share, with a 5 percent spread on the offering price. There will also be $260,000 in out-of-pocket costs to the corporation. a. Compute the net proceeds to the Presley Corporation. b . Compute the earnings per share immediately before the stock issue. C. Compute the earnings per share immediately after the stock issue. d. Determine what rate of return must be earned on the net proceeds to the corporation so there will not be a dilution in earnings per share during the year of going public. e . Determine what rate of return must be earned on the proceeds to the corporation so there will be a 5 percent increase in earnings per share during the year of going public. N Given: Shares Additional New Shares Relative to Shareholder 3 Outstanding Earnings EPS Issuance Outstanding New EPS Dilution Price A b ) & c ) 2, 100,000 7,200,000 800,000 25 6 Revenue from Sale of Shares: Out of Pocket Expense: 260,000 8 Spread %: 5.0% 9 Total Spread Amt: 10 a Net Proceeds 11 d) & e) % Capital Gains from Sale of Shares: Step 3: % Cap Gains=Addtnl Earnings/Net Proceeds Step 4: % Cap Gains=Addtnl Earnings/Net Proceeds 12 Additional Earnings (capital gains): Step 2: Addtnl Earnings=New Earnings-Orig Earnings Step 3: Addtnl Earnings=New Earnings-Orig Earnings 13 New Earnings Amount: Step 1: if New Earngs/Total Shares should = Orig EPS, Step 2: New Earngs = Outstand Share * New EPS 14 EPS accounting for gains from share sales: ... Then New Earngs = Outstand Share * Orig EPS Step 1: if (New EPS-Orig EPS)/Orig EPS should = .05 ... Then New EPS = .05*Orig EPS+Orig EPS 15 Percent Change