16-10 Stock Repurchase Example- Cash dividend versus share repurchase Assets Liabilities Equity C. After stock repurchase Cash $50,000Debt Other assets 850,000 Equity 900.000 Value of Firm 900,000 Value of Firm 900,000 Shares outstanding=90,000 Price per share=$900,000/90,000=$10 Irwin/McGraw-Hill CThe McGraw-Hill Commpanies, Inc, 2001©The McGraw-Hill Companies, Inc.,2001 16- 10 Irwin/McGraw-Hill Stock Repurchase Assets Liabilities & Equity C. After stock repurchase Cash $50,000 Debt 0 Other assets 850,000 Equity 900,000 Value of Firm 900,000 Value of Firm 900,000 Shares outstanding = 90,000 Price per share = $900,000 / 90,000 = $10 Example - Cash dividend versus share repurchase