po pogo Question Help Quisco Systems has 6.3 bilion shares outstanding and a share price of 817 81. Quisco is considering developing a new networking product in house at a cost of $507 milion Alternatively Quince can acquire a firm that already has the technology for $895 million worth (at the current price of Qulisco stock. Suppose that acent the expense of the new technology, Quisco will have EPS of $0 81 a. Suppose Quisco develops the product in house. What impact would the development cont have on Guisco's EPS? Assume all costs are incurred this year and are treated as an R&D expense Quisco's tax rate is 35%, and the number of shares outstanding is unchanged b. Suppose Quisco does not develop the product in house but instead acquires the technology. What affect would the acquisition have on Quisco's EPs this year? (Note that acquisition expenses do not appear directly on the income statement Assume the firm was acquired at the start of the year and has no revenues or expenses of its own, so that the only effect on EPS is due to the change in the number of uhares outstanding) c. Which method of acquiring the technology has a smaller impact on earings? Is this method cheaper? Explain 2. Suppose Quinto develop the product in house. What impact would re development cost have on Quisco's EPS? Assume at couts are incurred whis year and are seated at an R&D expanse, Quisco's tax rate is 35%, and the number of shares outstanding in unchanged. Duisco's new EPS would be 5 329