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 (2 million shares issued at par value of $10 per share) 20,000,000
Paid-in capital in excess of par 10,000,000
Retained earnings 45,000,000
Net worth $ 75,000,000
a-1. How many shares would be outstanding after a two-for-one stock split? (Do not round intermediate calculations. Input your answer in millions (e. g., $1.23 million should be entered as "1.23").)
a-2. What would be its par value? (Do not round intermediate calculations and round your answer to 2 decimal places.)
b-1. How many shares would be outstanding after a three-for-one stock split? (Do not round intermediate calculations. Input your answer in millions (e. g., $1.23 million should be entered as "1.23").)
b-2 What would be its par value? (Do not round intermediate calculations and round your answer to 2 decimal places.)
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? (Do not round intermediate calculations and round your answers to 2 decimal places.)
EPS Before?
EPS after 2 for 1 split?
EPS after 3 for 1 split?
d. What would be the price per share after the two-for-one stock split? After the three-for-one stock split? (Assume that the price-earnings ratio of 10.00 stays the same.) (Do not round intermediate calculations and round your answers to 2 decimal places.)
Price after 2 for 1 split?
Price after 3 for 1 split?