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    EPS

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    Consider the following information that you propose to use to obtain an estimate of year 2004 EPS for the MacLog Company:

    Year 2003 Estimated yr 2004

    GDP 11,000 billion
    GDP growth 3.5%
    Sales per share $800
    Operating profit margin 12%
    Depreciations/ Fixed Assets 14%
    Fixed Asset turnover 2
    Interest rate 3.5%
    Total asset turnover 0.7
    Debt/ Total Asset 45%
    Tax rate 36%

    In addition, a regression analyst indicates the following relationship between growth in sales per share for MacLog and GDP growth is: % change sales per share= 0.015+ 0.75 (%change GDP)

    Calculate the firm EPS for 2004

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    https://brainmass.com/business/accounting/calculate-eps-maclog-company-364609

    Solution Preview

    The % change in sales per share = 0.015 + 0.75 X 3.5% = 4.125%
    The sales per share for 2004 = 800 X (1+4.125%) = $833
    Operating profit margin (EBITDA) = 12%
    So EBITDA per share = 833 X 12% = ...

    Solution Summary

    The solution explains how to calculate the earnings per share.

    $2.19

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