Answer:
$40.45
Explanation:
Given;
current market value of equity = $32,400
excess cash = $2,100
total assets = $22,400
net income = $3,210
Outstanding shares = 800
Price per share for the current shares
= current market value of equity / Outstanding shares
= $32,400 / 800
= $40.5
Now, the excess cash (i.e $2100) is used for purchasing shares
thus,
number of shares repurchased = excess cash / Price per share
or
number of shares repurchased = $2,100 / ( $40.5 per share ) = 51.85
or 51 shares
Therefore, the number of outstanding shares = 800 - 51 = 749
Thus, new equity = current market value of equity - excess cash
= $32,400 - $2,100 = $30,300
Hence,
the stock price per share be after the stock repurchase is completed
= New equity / Outstanding share
= $30,300 / 749
= $40.45
