Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Wilson Pharmaceuticals' stock has done very well in the market during the last three years. It has risen from $25 to $50 per share. The

image text in transcribedimage text in transcribed

Wilson Pharmaceuticals' stock has done very well in the market during the last three years. It has risen from $25 to $50 per share. The firm's current statement of stockholders' equity is as follows: a-1. How many shares would be outstanding after a two-for-one stock split? (Do not round intermediate calculations. Input your answer in millions (e.g., \$1.23 million should be entered as "1.23").) Answer is complete and correct. Number of shares a-2. What would be its par value? (Do not round intermediate calculations and round your answer to 2 decimal places.) Answer is complete but not entirely correct. b-1. How many shares would be outstanding after a three-for-one stock split? (Do not round intermediate calculations. Input your answer in millions (e.g., $1.23 million should be entered as "1.23").) c. Assume that Wilson earned $18 million. What would its earnings per share be before and after the two-for-one stock split? After the three-for-one stock split? (Do not round intermediate calculations and round your answers to 2 decimal places.) d. What would be the price per share after the two-for-one stock split? After the three-for-one stock split? (Assume that the priceearnings ratio of 11.11 stays the same.) (Do not round intermediate calculations and round your answers to 2 decimal places.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Investing In Fixed Income Securities Understanding The Bond Market

Authors: Gary Strumeyer

1st Edition

0471465127, 9780471465126

More Books

Students also viewed these Finance questions