Moonscape has just completed an initial public offering. The firm sold 3 million shares at an offer price of $8 per share. The underwriting spread was $0.30 a share. The price of the stock closed at $12.00 per share at the end of the first day of trading. The firm incurred $300,000 in legal, administrative, and other costs. What were flotation costs as a fraction of funds raised? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) Costs as percent of funds raised %

Moonscape has just completed an initial public offering. The firm sold 3 million shares at an offer price of $8 per share. The underwriting spread was $0.30 a share. The price of the stock closed at $12.00 per share at the end of the first day of trading. The firm incurred $300,000 in legal, administrative, and other costs. What were flotation costs as a fraction of funds raised? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) Costs as percent of funds raised %

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Moonscape has just completed an initial public offering. The firm sold 3 million shares at an offer price of $12 per share. The underwriting spread was $0.30 a share. The price of the stock closed at $18.00 per share at the end of the first day of trading. The firm incurred $300,000 in legal, administrative, and other costs. What were flotation costs as a fraction of funds raised? Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Flotation cost as percent of funds raised %
I know the answers for A (16.6) and B (204,724,996), but I am stuck on C: Match Group went public in November 2018. The company sold 15,833,333 shares at $16.0 per share. The underwriting spread was $2.66 a share, and the direct expenses were $0.41 a share. a. What was the percentage underwriting spread? (Enter your answer as a percent rounded to 1 decimal place.) ANSWERED b. How much did the company raise after all expenses? (Enter your answer in dollars not millions. Round your answer to the nearest dollar.) ANSWERED c. On its first day of trading the stock closed at $20.74. Calculate the total dollar cost of underpricing. (Enter your answer in dollars not millions. Round your answer to the nearest dollar.) NEED HELP WITH "C" PLEASE
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Young Corporation stock currently sells for $20 per share. There are 1 million shares currently outstanding. The company announces plans to raise $4 million by offering shares to the public at a price of $20 per share. a. If the underwriting spread is 8%, how many shares will the company need to issue in order to be left with net proceeds (before other administrative costs) of $4 million? Note: Do not round intermediate calculations. Round your answer to the nearest whole number. Number of shares 217,391 b. If the under writing spread is 8% and the other administrative costs are $45,000, what is the dollar value of the total direct costs of the issue? Note: Enter your answer in dollars not in millions. Do not round intermediate calculations. Round your answer to the nearest whole dollar amount. Total direct costs c. If the share price falls by 4% at the announcement of the plans to proceed with a seasoned offering, what is the dollar cost of the announcement effect? Note: Enter your…
Cullumber, Inc., a high-technology firm in Portland, raised a total of $60 million in an IPO. The company received $27 of the $30 per share offering price. The firm’s legal fees, SEC registration fees, and other out-of-pocket costs were $350,000. The firm’s stock price increased 17 percent on the first day of trading. What was the total cost to the firm of issuing the securities?
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