What was the flotation cost as a percentage of funds raised

Reference no: EM13260867

High Mountain Gear issued 240,000 shares of stock last week. The underwriters charged a 7.85% spread in excnahge for agreeing to a firm committment. The legal and accounting fees were $385,000. The company incurred $98,000 in indirect costs related to management time and other internal expenses. The offer price was $21 a share. Within the first hour of trading, the stock was selling for $23.20 a share. What was the flotation cost as a percentage of the funds raised?

A) 21.53 percent
B) 25.29 percent
C) 27.46 percent
D) 33.80 percent
E) 41.22 percent

Reference no: EM13260867

Questions Cloud

Art and science of corporate investment decisions : A firm’s net income is calculated as the difference in the revenues it recognizes for the period less the expenses it incurred in the process of generating those revenues.

What is the specific gravity of this other fluid : A bottle has a mass of 35.00 g when empty and 98.43 g when filled with water. What is the specific gravity of this other fluid

What are the firm market value capital structure weights : The market risk premium is 8.2 percent, T-bills are yielding 3 percent, and Titan Mining's tax rate is 35 percent.

What is the damping constant of the oscillation : A mass of .500 kg is connected to a spring of spring constant 30 N/m. The oscillation begins by pulling the mass to the right to amplitude 0.40 m before release, what is the damping constant of the oscillation

What was the flotation cost as a percentage of funds raised : Within the first hour of trading, the stock was selling for $23.20 a share. What was the flotation cost as a percentage of the funds raised?

Compute the angle of refraction for each wavelength : The index of refraction for crown glass is 1.512 at a wavelength of 660 nm (red), whereas its index of refraction is 1.530 at a wavelength of 410 nm (violet), what is the angle of refraction for each wavelength

Piece of media containing visual material to analyze : Pick one piece of media containing visual material to analyze. This can be a television commercial, a movie trailer, or a printed advertisement from a newspaper or magazine.

Which one requires daily inspection : What role does each of the three main financial statements play in the decision-making process of the financial manager? Which one requires daily inspection? How long before trends are seen?

Dinsey entered into a long-term agreement : A few years ago, Dinsey entered into a long-term agreement with McDonalds that included, among other things, joint promotions. From Disney perspective and what you know about the two brands, was this the right decision? is there a downside?

User Account

All Pages