A Firm Has a Market Value Equal to Its Book

A firm has a market value equal to its book value.Currently,the firm has excess cash of $300 and other assets of $6,200.Equity is worth $5,000.The firm has 500 shares of stock outstanding and net income of $720.What will the new earnings per share be if the firm uses its excess cash to complete a stock repurchase?

A) $1.44
B) $.94
C) $.86
D) $1.53
E) $1.71