Given answer financial accounting question TechGrow Inc. has the following financial position:•Market value equals book value•Excess cash: $2,400,000•Operating assets: $15,600,000•Total equity: $18,000,000•Outstanding shares: 1,500,000Net income: $3,200,000The board has approved using 60% of excess cash for a sharerepurchase program. Calculate:1. How many shares will remain outstanding after the repurchase?2. What is the price per share for the repurchase?3. What percentage of outstanding shares will be repurchased?

Step 1:1. The number of shares outstanding after repurchase is calculated as follows: Shares…

Answered: TechGrow Inc. has the following…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter23: Corporate Restructuring

Section: Chapter Questions

Problem 12P

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Please Solve this Question i need answer what is the earning per share after the repurchase ?
Blasco's has a market value equal to its book value. Currently, the firm has excess cash of €1,332, other assets of €11,674, and equity of €7,200. The firm has 1200 shares outstanding and net income of €838. Blasco's has decided to spend one-third of its excess cash on a share repurchase program. How many shares will be outstanding after the share repurchase is completed? Show your steps. Jefferson Refining is issuing a rights offering wherein every shareholder will receive one right for each share of equity they own. The new shares in this offering are priced at £21 plus 3 rights. The current market value of the equity is £75 million with 3 milion shares outstanding. What is the value of one right? Show your steps. If an IPO is underpriced then the: investors in the IPO are generally unhappy with the underwriters. issue is less likely to sell out. share price will increase on the first day of trading. issuing firm is guaranteed to be…
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Cliff Corp. (CC) has an enterprise value (MV equity + debt – cash) of $330 million, $50 million in cash and $30 million in debt. CC has 10 million shares outstanding and is considering using its $50 million in cash to repurchase shares. What s CC’s share price prior to the prior to the repurchase? How many shares will CC repurchase? Suppose news is released that increases enterprise value to $350 million immediately after the repurchase, then what is CC’s new share price? If management knows about the news prior to the repurchase, should they repurchase before or after the news is released?
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The following information applies to RTC Logistics Ltd.: Operating income (EBIT)= $300,000Shares outstanding = 120,000 sharesDebt = $100,000EPS = $1.45Interest expense = $10,000Stock price = $17.40Tax rate = 40% The company is considering recapitalization where it would issue $348,000 worth of new debt and use the proceeds to buy back $348,000 worth of common stock. The buyback will be undertaken at the pre-recapitalization share price of $17.40 per share. The recapitalization is not expected to have an effect on operating income or the tax rate. After the recapitalization, the company’s total interest expense will be $50,000.Number of shares bought back = 348,000/17.40 = 20,000 shares. Assume that the recapitalization has no effect on the company’s price earnings (P/E) ratio. What is the expected price of the company’s stock following the recapitalization? Should RTC proceed with the recapitalisation exercise? Explain.
(a) Calculate the theoretical ex-rights price per share of Squid Inc. following the rights issue
Wyatt Oil has assets with a market value of $600 million, $70 million of which are cash. It has debt of $250 million, and 20 million shares outstanding. Assume perfect capital markets. If Wyatt Oil distributes the $70 million as a share repurchase, then its stock price after the share repurchase will be closest to: $11.00 $12.50 $14.00 $17.50
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Firm B has a net income of $2 million and has 1 million shares of common stocks outstanding. Firm B’s shares currently trade at $32 per share. The management is planning to use available cash to purchase 20% of Firm B’s shares in the open market. The repurchase is expected to have no effect on either net income or Firm B’s P/E ratio. What will be the share price of Firm B following the share repurchase? After 5 to 1 share split, Firm S paid a dividend of $0.75 per share, which represents 9 percent increase over last year’s pre-split dividend. What was last year’s dividend per share?
TJ's has a market value equal to its book value. Currently, the firm has excess cash of $218,500, other assets of $897,309, and equity of $547,200. The firm has 40,000 shares of stock outstanding and net income of $59,800. Management has decided to spend 15 percent of the excess cash on a share repurchase program. How many shares of stock will be outstanding after the stock repurchase is completed?
Instrument Corporation has the following investment which was held throughout 2021–2022. Assume the organization has invested in stock and holds 40%. Fair Value Cost 12/31/21 Equity investment $900,000 $1,200,000 A. Record the initial investment. B. Total dividends paid equal $400,000. Record the dividends. C. Total Net Income for the year equals $600,000. Record the income. D. If Instrument increased its investment to 55%, what would occur? Explain your answer.

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