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MysteryDove12
22.06.2021 •
Business
DRK, Inc., has just sold 110,000 shares in an initial public offering. The underwriter’s explicit fees were $66,000. The offering price for the shares was $60, but immediately upon issue, the share price jumped to $66.00. a. What is the total cost to DRK of the equity issue?
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Ответ:
$726000
Explanation:
Based on the information given in the question, the total cost to DRK of the equity issue will be calculated thus:
Firstly, we'll calculate the implicit cost per share which will be:
= Increased price - Offering price
= $66 - $60
= $6
Then, the total implicit cost will be:
= $6 × 110000
= $660000
Then, the total cost to DRK of the equity issue will be:
= Explicit cost + Implicit cost
= $66000 + $660000
= $726000
Ответ: