Flashback Corporation is evaluating an extra dividend versus a share repurchase.
ID: 2720024 • Letter: F
Question
Flashback Corporation is evaluating an extra dividend versus a share repurchase. In either case, $22,000 would be spent. Current earnings are $3.70 per share, and the stock currently sells for $91 per share. There are 4,000 shares outstanding. Ignore taxes and other imperfections.
What will Flashback’s EPS and PE ratio be under the two different scenarios? (Do not round intermediate calculations. Round your answers to 2 decimal places (e.g., 32.16).)
What will Flashback’s EPS and PE ratio be under the two different scenarios? (Do not round intermediate calculations. Round your answers to 2 decimal places (e.g., 32.16).)
Explanation / Answer
Flashback Corporation is evaluating an extra dividend versus a share repurchase.
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