Question
(Stock repurchases and earnings per share) CareMore, Inc. provides in-home medical assistance to the elderly and earned net income of $ 5.2 million that it
(Stock repurchases and earnings per share) CareMore, Inc. provides in-home medical assistance to the elderly and earned net income of $ 5.2 million that it plans to use to repurchase shares of the firm's common stock, which is currently selling for $ 50 a share. CareMore has 15 million shares of stock outstanding.
What fraction of the firm's shares can the firm repurchase for $ 5.2 million?
If the share repurchase has no impact on the firm's net income, what will be its earnings per share after the repurchase?
a. What fraction of the firm's shares can the firm repurchase for $ 5.2 million? % (Round to two decimal places.) ANSWER:
b. If the share repurchase has no impact on the firm's net income, what will be its earnings per share after the repurchase? $ (Round to four decimal places.) ANSWER:
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Essentials Of Financial Management Text And Cases
Authors: George C Philippatos
1st Edition
0816267162, 978-0816267163
