Projected after-tax earnings after completion of project

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Reference no: EM131947126

1. The post merger P/E of Turnbull Corporation is predicted to be 15. The EPS for the previous four quarters totals $2.00 per share for Turnbull. The number of shares outstanding is 100,000. The earnings valuation of Turnbull is

a. $1 million

b. $3 million

c. $5 million

d. none of the above

2. Hawthorne Corporation has a valuation of $1 million. The price per share is $10. The shares outstanding are

a. 100

b. 1000

c. 100,000

d. none of the above

3. Lawson Corporation has 200,000 shares outstanding. The price per share is $20 The market valuation of Lawson is

a. $2 million

b. $3 million

c. $4 million

d. none of the above

4. Commonwealth Corporation is planning an equity issue to finance a new project. Commonwealth plans to issue 100,000 shares of stock. Projected after-tax earnings after completion of project are $2million and shares outstanding will total 200,000. What is the projected EPS after completion of the project?

a. $6

b .$8

c. $10

d. none of the above

5. Dusty Company is planning an equity issue to finance a new project. Dusty plans to issue 100,000 shares of stock. Projected EPS after completion of the project is $10 and total shares outstanding will be 200,000. What are the projected after-tax earnings after completion of the project?

a. $1 million

b. $2 million

c. $3 million

6. Which of the following leans away from the selection of debt for financing?

a. control

b. income

c. flexibility

d. none of the above

Reference no: EM131947126

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