The Hamilton Corporation Company has 4 million shares of stock outstanding and w

Question

The Hamilton Corporation Company has 4 million shares of stock outstanding and will report earnings of $6,360,000 in the current year. The company is considering the issuance of 2 million additional shares which can only be issued at $38 per share.

Assume the Hamilton Corporation Company can earn 7.00 percent on the proceeds. Calculate the earnings per share. (Enter your answer in dollars per share not in millions. Round your answer to 2 decimal places. Omit the "$" sign in your response.)

The Hamilton Corporation Company has 4 million shares of stock outstanding and will report earnings of $6,360,000 in the current year. The company is considering the issuance of 2 million additional shares which can only be issued at $38 per share.

Explanation / Answer

Hi,

Please find the answer as follows:

Earnings Per Share = (6360000 + 2000000*38*7%)/(4000000 + 2000000) = $1.95

Answer is $1.95.

Thanks.

Related Questions

Navigate

• Browse (All)
• Browse T
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.