16-8 Stock Repurchase Example- Cash dividend versus share repurchase Assets Liabilities& equity A. Original balance sheet Cash $150,000Debt Other assets 850,000 Equity ,000,000 Value of Firm 1.000.000 Value of Firm 1.000.000 Shares outstanding= 100,000 Price per share=$1,00000/100,000=$10 Irwin/McGraw-Hill CThe McGraw-Hill Commpanies, Inc, 2001©The McGraw-Hill Companies, Inc.,2001 16- 8 Irwin/McGraw-Hill Stock Repurchase Assets Liabilities & Equity A. Original balance sheet Cash $150,000 Debt 0 Other assets 850,000 Equity 1,000,000 Value of Firm 1,000,000 Value of Firm 1,000,000 Shares outstanding = 100,000 Price per share = $1,000,000 / 100,000 = $10 Example - Cash dividend versus share repurchase