A firm has a market value equal to its book value. Currently, the firm has excess cash of $11,000, other assets of $6,900, and equity of $8,000. The firm has 800 shares of stock outstanding and a net income of $1,000. The firm has decided to spend half of its excess cash on a share repurchase program. How many shares of stock will be outstanding after the stock repurchase is completed? a. 765 shares b. 785 shares c. 725 shares d. 745 shares e. 705 shares
A firm has a market value equal to its book value. Currently, the firm has excess cash of $11,000, other assets of $6,900, and equity of $8,000. The firm has 800 shares of stock outstanding and a net income of $1,000. The firm has decided to spend half of its excess cash on a share repurchase program. How many shares of stock will be outstanding after the stock repurchase is completed? a. 765 shares b. 785 shares c. 725 shares d. 745 shares e. 705 shares
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A firm has a market value equal....Accounting question
Transcribed Image Text:A firm has a market value equal to its book value.
Currently, the firm has excess cash of $11,000, other assets
of $6,900, and equity of $8,000. The firm has 800 shares of
stock outstanding and a net income of $1,000. The firm has
decided to spend half of its excess cash on a share
repurchase program. How many shares of stock will be
outstanding after the stock repurchase is completed?
a. 765 shares
b. 785 shares
c. 725 shares
d. 745 shares
e. 705 shares
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