Hodgkiss Corporation is evaluating an extra dividend versus a share repurchase. In either case, $27,000 would...

Hodgkiss Corporation is evaluating an extra dividend versus a share repurchase. In either case, $27,000 would be spent. Current earnings are $2.70 per share, and the stock currently sells for $96 per share. There are 4,500 shares outstanding. Ignore taxes and other imperfections.

What will the company’s EPS and PE ratio be under the two different scenarios? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)

	Extra Dividend	Share Repurchase
EPS	$	$
PE Ratio

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Expert Solution

NO OF SHARES ARE NOT ROUNDED AS IT IS WRITTEN NO INTERMEDIATE ROUNDING SHOULD BE DONE.

jeff jeffy answered 1 year ago

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