Firm X Is Planning on Merging with Firm Y

question 80

Multiple Choice

Firm X is planning on merging with Firm Y. Firm X will pay Firm Y's stockholders the current value of their stock in shares of Firm X. Firm X currently has 3,900 shares of stock outstanding at a market
Price of $40 a share. Firm Y has 2,200 shares outstanding at a price of $17 a share. The after-
Merger earnings will be $7,800. What will the earnings per share be after the merger?

• A) $1.61
• B) $1.67
• C) $1.75
• D) $1.81
• E) $1.86

Recognize intellectual property and its role in international business.

Understand how regulatory environments influence international business opportunities.

Comprehend the importance of sustainable and responsible business practices.

Understand the importance of data privacy in the context of global companies.

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Definitions:

Beginning Work

The work-in-process inventory at the start of an accounting period, representing unfinished goods.

Total Physical Units

Total physical units refer to the total count of individual units of product produced by a company in a given period of time.

Units Completed

The number of finished products that have been completed within a specific period in a manufacturing process.

Conversion Costs

The combined costs of direct labor and manufacturing overhead, which are incurred to convert raw materials into finished products.