Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Required information Skip to question Company A Company B Total earnings $2,000,000 $1,000,000 Number of shares outstanding 400,000 100,000 Earnings per share $5.0 $10.00 Price/earnings
Required information
Skip to question
| Company A | Company B | |
| Total earnings | $2,000,000 | $1,000,000 |
| Number of shares outstanding | 400,000 | 100,000 |
| Earnings per share | $5.0 | $10.00 |
| Price/earnings | 6X | 3X |
| Market price/share | $30.00 | $30.00 |
Assume Company A pays a 20% premium for Company B in a pooling of interests' transaction. Calculate the post-merger EPS for Company A.
Multiple Choice
-
$10.00
-
$5.00
-
$7.50
-
$6.00
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Financial Citizenship Experts Publics And The Politics Of Central Banking
Authors: Annelise Riles
1st Edition
1501732722, 978-1501732720
