Essay
Ted Tech Inc.is offering a 10% stock dividend.The firm currently has 200,000 shares outstanding and after-tax profits of $800,000.The current price of the stock is $48.
a.Calculate the new earnings per share.
b.What is the original price/earnings multiple?
c.Providing that the price/earnings multiple stays the same,what will the new stock price be after the stock dividend?
Correct Answer:
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a. EPS = $800,000/200,000 (1.1...View Answer
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