User Account

All Pages

What is immediate dilution potential for new stock issue

Assignment Help Accounting Basics
Reference no: EM132616031

Question - American Health Systems currently has 6,500,000 shares of stock outstanding and will report earnings of $12 million in the current year. The company is considering the issuance of 1,300,000 additional shares that will net $60 per share to the corporation.

a. What is the immediate dilution potential for this new stock issue?

b-1. Assume that American Health Systems can earn 11 percent on the proceeds of the stock issue in time to include them in the current year's results. Calculate earnings per share.

b-2. Should the new issue be undertaken based on earnings per share?

Reference no: EM132616031

Questions Cloud

Calculate weighted average cost of capital for royta ltd : Assuming that the company uses the CAPM to calculate its cost of equity. Calculate its weighted average cost of capital. The current tax rate is 30%.
What is impairment loss for the period : The Fair value less cost to sell is $200,000. The value in use is $220,000. What is impairment loss for the period
Describe how you spend most of your time : Describe how you spend most of your time. Is this what you expected? Why or why not? How will you rearrange these items to dedicate enough time to your.
Role of vpn to support the security of businesses : Explain the significance of VPN for contemporary organisations and Discuss the role of VPN to support the security of businesses and corporations
What is immediate dilution potential for new stock issue : The company is considering the issuance of 1,300,000 additional shares that will net $60 per share to the corporation. What is immediate dilution potential
How do record the events in general journal format : Post the events to accounts shown under an accounting equation. Oct. 2 Purchased $12,500 of merchandise on account with the terms 2/10, n/30.
Analyze demographic and economic data of country : Analyze the demographic and economic data of a country that Walmart is currently not operating in.
What type of assets are defined as cash in accounting : Many people think of cash as coins and notes. In accounting, cash has a broader meaning. What type of assets are defined as cash in accounting?
Advise benjamin on ways can overcome cash flow : Advise Benjamin on ways he can overcome his cash flow management issues. Benjamin run sacheese shop at the local shopping centre.

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Theory of interest - term structure of interest rates

Term Structure of Interest Rates

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd