question archive 1) The Sweet Shoppe and Candy Land are all-equity firms
1) The Sweet Shoppe and Candy Land are all-equity firms
Subject:BusinessPrice: Bought3
1) The Sweet Shoppe and Candy Land are all-equity firms. The Sweet Shoppe has 500 shares outstanding at a
market price of $96 a share. Candy Land has 2,700 shares outstanding at a price of $24 a share. The Sweet
Shoppe is acquiring Candy Land for $62,000 in cash. The incremental value of the acquisition is $3,600.
What is the net present value (NPV) of acquiring Candy Land to The Sweet Shoppe?
2) Scott Enterprises is acquiring Moore Industries for $22,000 worth of Scott Enterprises stock. Scott Enterprises
currently has 7,500 shares of stock outstanding at a price of $28 a share. Moore Industries has 1,800 shares
outstanding at a price of $12 a share. The synergy value of the acquisition is $1,100. What is the stock price
per share of Scott after the acquisition using stock payment?
