What would its earnings per share be

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Question - Wilson Pharmaceuticals' stock has done very well in the market during the last three years. It has risen from $45 to $70 per share. The firm's current statement of stockholders' equity is as follows:

Common stock (4 million shares issued at par value of $10 per share) $40,000,000

Paid-in capital in excess of par 15,000,000

Retained earnings 45,000,000

Net worth $100,000,000

Required -

a-1. How many shares would be outstanding after a two-for-one stock split?

a-2. What would be its par value?

b-1. How many shares would be outstanding after a three-for-one stock split?

b-2 What would be its par value?

c. Assume that Wilson earned $14 million. What would its earnings per share be before and after the two-for-one stock split? After the three-for-one stock split?

Reference no: EM132618624

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