![how to calculate ppm cost dollars how to calculate ppm cost dollars](https://lh3.googleusercontent.com/-anR9rdEFNbs/VmWgQAWYpqI/AAAAAAAAbUI/mX0Qztms-sw/s557-Ic42/Untitled1.png)
Step 3: Next, determine the number of new shares issued by the company, and NN denotes it. Step 2: Next, determine the total number of shares of the company prior to the issuance of new shares, and NT denotes it.
![how to calculate ppm cost dollars how to calculate ppm cost dollars](https://image3.slideserve.com/5902074/the-food-cost-formula-in-use-l.jpg)
Step 1: Firstly, determine the number of shares held by the subject shareholder (A in this case), and NA denotes it. The formula for dilution can be derived by using the following steps: Therefore, the shareholding of John is expected to dilute from 13.33% to 8%, while the share price is expected to increase from $75 per share to $80 per share with the new issuance. Diluted Shareholding = 20,000 / (150,000 + 100,000)ĭiluted Share Price is calculated using the formula given belowĭiluted Share Price = (P T * N T + P N * N N) / (N T + N N).
![how to calculate ppm cost dollars how to calculate ppm cost dollars](https://image.slidesharecdn.com/caclarityppmprojectmanagementuserguide-150512232926-lva1-app6891/95/ca-clarity-ppm-project-management-user-guide-50-638.jpg)
Also, compute the diluted share price if the current price is $75 per share and the new shares are expected to be issued at $80 per share. Calculate the diluted shareholding of John post new shares issuance. Currently, John holds 20,000 shares out of the total of 150,000 outstanding shares of the company and has no plans to purchase the new shares. Let us take the example of another company that is scheduled to undertake a capex plan funded through the issuance of additional 100,000 shares. Therefore, the shareholding of David is expected to dilute from 5% to 3.33% in case all the stock options are exercised.
How to calculate ppm cost dollars download#
You can download this Dilution Formula Excel Template here – Dilution Formula Excel Template Dilution Formula – Example #1