Question: The Carlton Corporation has S6 million in earnings after taxes and 3 million shares outstanding. The stock trades at a PE of 20. The firm has S3 million in excess cash.
a. Compute the current price of the stock. (Do not round intermediate calculations and round your answer to 2 decimal places.) Current price
b. if the $3 million is used to pay dividends, how much will dividends per share be? (Do not round intermediate calculations and round your answer to 2 decimal places.) Dividends per share
c. If the $3 million is used to repurchase shares in the market at a price of $43 per share, how many shares will be acquired? (Do not round intermediate calculations and round your answer to the nearest whole share.)
Number of shares acquired shares