Question
The following table show pre-merger figures of CH Enterprises and ComYon Corporation: CH Enterprises (pre-merger) ComYon Corp. (pre-merger) CH Enterprises (post-merger) Earnings per share $2.00
The following table show pre-merger figures of CH Enterprises and ComYon Corporation:
| CH Enterprises (pre-merger) | ComYon Corp. (pre-merger) | CH Enterprises (post-merger) |
Earnings per share | $2.00 | $2.00 | ? |
Price per share | $40 | $20 | ? |
P/E Ratio | 20 | 10 | ? |
Number of Shares | 100,000 | 100,000 | ? |
Total earnings | $200,000 | $200,000 | ? |
Total market Value | $4,000,000 | $2,000,000 | ? |
Current earnings per dollar invested in stock (line 1/line 2) | $.05 | $.10 | ? |
Note: This merger will produce no gains. Thus, total earnings and total market value should be unaffected by the merger. But earnings per share increase. CH Enterprises will use 50,000 of its shares (priced at $40) to acquire the 100,000 shares of ComYon (priced at $20).
Complete the table with the correct post-merger figures. Please give me the process of the answers.
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