Read the article and respond to the following questions:

Robin Peterson the ceo of Telder incorporation, was reviewing the financial statement for the first three months of the year. He saw that sales and net income were lower than expected. Because the reported net income and the related earning per share were below expectations, the price of the stock declined. Robin held a meeting with top management and expressed his concerns over the declinging trend in sales and incomes. He stated the reduced profitability meant that he needed to formulate a plan to somehow increase the earning per share. The bice president of marketing suggested that more advertising might help sales increase. Robin said spending more money on advertising would not guarantee an increase in sales. Then he announced that the excess comany cash would instead be used to buy back shares of outstanding common stock; this move would help increase the earnings per share because fewer shares would be oustanding. Robin reminded everyone that yearly financial statements would be analyzed and the current year would be compared to previous years' results. He then stated that the treasury stock would lower the total stockholdrs' equitym which could then provide a stronger EPS so the current year would not look as bad. Finally, Robin reminded everyone that with fwewer shares of stock outstanding, the dividend per share could be increased and that would help make Teldar stock more attractive. The CFO argued that buying stock merely to increase performance measures such as EPS was manipulative and unethiucal, and financial analysts would easily see what Teldar was trying to do.

Answer the below questions:

1. Why did the CEO want to repurchase shares of Telder common stock?

2. Would the repurchase of common stock really have any impact on the financial ratios?

3. Would an investor or financial analyst be able to see that financial performance measures were improved because of the stock repurchase?

4. Are any ethical issues involved?

5. Were the concerns expressed by the CFP valid?

6. Do you have any other thought?