Percentage of the market value of the shares

Assignment Help Business Management

Reference no: EM13971224

XYZ Corporation has received a firm commitment from its underwriter to purchase 1 million shares of stock that will be marketed to the general public at $23 per share. The underwriter's spread is $1.90 per share and the issuing firm will pay an additional $1.65 million in legal and other fees. The issue was fully sold on the first day and the stock closed at $27.50 on that day. Calculate both the direct expense of issuance and the indirect (i.e., underpricing) expense. What percentage of the market value of the shares is represented by these costs?

Reference no: EM13971224

Questions Cloud

Cost of goods sold for the year : What was Cost of goods sold for the year?

How will you get the data you need to test your hypotheses : How will you get the data you need to test your hypotheses? What tools or devices will you use to make or record observations?How will you choose the sample? What degree of accuracy or level of confidence can you guarantee?

Analyze the changes in roce and its components for hasbro : Exhibit 4.31 presents profitability ratios for Hasbro for Year 2 and Year 3. Calculate each of these financial ratios for Year 4. The income tax rate is 35 percent.

What is the stock worth today : The company's last dividend was $3.25, and it is unlikely to change the amount paid out. If the required rate of return is 12 percent, what is the stock worth today? (Round to the nearest dollar.)

Percentage of the market value of the shares : What percentage of the market value of the shares is represented by these costs?

About the present value : What is the present value of a $1,000 annuity for 10 years, with the first payment occurring at the end of year 10 (that is, ten $1,000 payments occurring at the end of year 10 through 19), given a discount rate of 10 percent?

Find equation of motion of the link abc : A mechanism is shown in the following figure. Link ABC has an arc slot with a radius of R =100mm . The center of the arc O1 is on the line BC. The crank OA has a length of 100 mm. It rotates about point O with a constant angular velocity of ω =4 r..

How does vaccine distribution relate to key operations : How does vaccine distribution relate to key operations and supply chain management questions including: quality management, new product development and forecasting?

Assuming that the yield to maturity of each bond remains : An investor has two bonds in her portfolio, Bond C and Bond Z. Each bond matures in 4 years, has a face value of $1,000, and has a yield to maturity of 8.2%. Bond C pays a 11.5% annual coupon, while Bond Z is a zero coupon bond. Assuming that the yie..

User Account

All Pages