A company's market value equals its book value. The company has excess cash of $2,400, other assets of $7,600, and total equity of $10,000. There are 1,000 shares outstanding and the company earned a net income of $1,500 last year. The company decides to use 75% of its excess cash for a share repurchase program. How many shares will remain outstanding after the stock repurchase?
A company's market value equals its book value. The company has excess cash of $2,400, other assets of $7,600, and total equity of $10,000. There are 1,000 shares outstanding and the company earned a net income of $1,500 last year. The company decides to use 75% of its excess cash for a share repurchase program. How many shares will remain outstanding after the stock repurchase?
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Transcribed Image Text:A company's market value equals its book value. The company has
excess cash of $2,400, other assets of $7,600, and total equity of
$10,000. There are 1,000 shares outstanding and the company earned
a net income of $1,500 last year. The company decides to use 75% of
its excess cash for a share repurchase program. How many shares will
remain outstanding after the stock repurchase?
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