Mercantile Exchange Is Being Acquired by National Sales

Multiple Choice

Mercantile Exchange is being acquired by National Sales. The incremental value of the acquisition is $2,500. Mercantile Exchange has 1,200 shares of stock outstanding at a price of $26 a share. National Sales has 6,500 shares of stock outstanding at a price of $54 a share. What is the net present value of the acquisition given that the actual cost of the acquisition using company stock is $32,780?

A) $887
B) $1,011
C) $920
D) $367
E) $1,046