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What will be the earnings per share

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Reference no: EM131110434

Marla's Cafe is attempting to acquire the Victory Club. Certain financial data on these corporations are summarized in the following table.

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Marla's Cafe has sufficient authorized but unissued shares to carry out the proposed merger.

a. If the ratio of exchange is 1.8, what will be the earnings per share (EPS) based on the original shares of each firm?

b. Repeat part a if the ratio of exchange is 2.0.

c. Repeat part a if the ratio of exchange is 2.2.

d. Discuss the principle illustrated by your answers to parts a throughc.

Reference no: EM131110434

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