$\begin{array} { r r } &\underline{\text { Alpha }} &\underline{ \text { Beta }} \
\text {Total earnings}& \$ 1,000,000 & \$ 600,000 \
\text {Number of shares outstanding}&400,000 & 200,000 \
\text {Earnings per share}&\$ 2.50 & \$ 3.00 \
\text {Price/earnings}&12 \mathrm { X } & 10 \mathrm { X } \
\text { Market price/share } & \$ 30.00 & \$ 30.00 \end{array}$
-Assume Alpha pays a 20% premium for Beta in a pooling of interests' transaction.Calculate the post-merger EPS for Alpha.
A) $2.50
B) $3.00
C) $3.50
D) $4.00

Question

$\begin{array} { r r } &\underline{\text { Alpha }} &\underline{ \text { Beta }} \
\text {Total earnings}& \$ 1,000,000 & \$ 600,000 \ 
\text {Number of shares outstanding}&400,000 & 200,000 \
 \text {Earnings per share}&\$ 2.50 & \$ 3.00 \ 
 \text {Price/earnings}&12 \mathrm { X } & 10 \mathrm { X } \
\text { Market price/share } & \$ 30.00 & \$ 30.00 \end{array}$
-Assume Alpha pays a 20% premium for Beta in a pooling of interests' transaction.Calculate the post-merger EPS for Alpha.
A) $2.50
B) $3.00
C) $3.50
D) $4.00

Quizplus · Accepted Answer

The Answer of $\begin{array} { r r } &\underline{\text { Alpha }} &\underline{ \text { Beta }} \
\text {Total earnings}& \$ 1,000,000 & \$ 600,000 \ 
\text {Number of shares outstanding}&400,000 & 200,000 \
 \text {Earnings per share}&\$ 2.50 & \$ 3.00 \ 
 \text {Price/earnings}&12 \mathrm { X } & 10 \mathrm { X } \
\text { Market price/share } & \$ 30.00 & \$ 30.00 \end{array}$
-Assume Alpha pays a 20% premium for Beta in a pooling of interests' transaction.Calculate the post-merger EPS for Alpha.
A) $2.50
B) $3.00
C) $3.50
D) $4.00

-Assume Alpha Pays a 20% Premium for Beta in a \text