Chandler Corporation has 1 million shares outstanding. The current price per sha

Question

Chandler Corporation has 1 million shares outstanding. The current price per share is $20. If the company decides to use $2 million dollars to repurchase shares at the market price, the company will have ________ shares outstanding worth approximately ________. Assume that the price does not change during the repurchase period.
Answer

900,000, $20 per share

900,000, $22.22 per share

1,000,000, $18 per share

1,000,000, $20 per share


Assume that Zybo, Inc. has sales of $10 million and inventory of $2 million. The corporation utilizes the percent-of-sales method of financial forecasting. If Zybo is expected to generate sales of $14 million next year, what will the firm's investment in inventory be?
Answer

$2.8 million

$2.0 million

$1.4 million

None of the above

Explanation / Answer

1,000,000, $20 per share $2.8 million

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