Vansteelandt Inc.has net income of $4,000,000 and 1,000,000 shares outstanding.Its common stock is currently selling for $50 per share.It needs to raise $2,000,000 in funds for a new asset.Its investment dealer plans to sell an issue of common stock to the public for $48 for a spread of 4% on offer price.How much must Vansteelandt's after tax income increase to prevent dilution of EPS?
A) $173,612
B) $80,000
C) $41,667
D) $40,000
Correct Answer:
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