Zip corporation has 3 million shares of outstanding common, Ask an Expert

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Zip Corporation has 3 million shares of outstanding common stock and total earnings of $15,000,000. The corporation is considering issuing 1 million more shares of common stock.

What will be the immediate dilution in earning per share (EPS)?

If the new shares will be sold at $20 per share and the proceeds from the sale can be invested at 10%, will there still be dilution? Based on the new EPS, should the new shares of common stock be issued?

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92788351

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