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shtirl [24]
3 years ago
9

Miller Fruit wants to expand its citrus grove operations. The firm estimates that it needs $8.6 million to buy land and establis

h its operations. Currently, the firm has 540,000 shares of stock outstanding at a market price per share of $34.80. If the firm decides to raise the needed capital through a rights offering, one right will be issued for each share of stock. The subscription price will be set at $33 a share. How many rights will a shareholder need to purchase one new share of stock in this offering?
Business
1 answer:
sergeinik [125]3 years ago
3 0

Answer:

2.072 rights

Explanation:

Amount needed to buy the land = $8.6 million = $8,600,000

stock outstanding = 540,000

Market price per share = $34.80

subscription price = $33 a share

Now,

Number shares to be issued = ( Amount needed ) ÷ ( subscription price )

= $8,600,000 ÷ $33

= 260606.06 shares

1 rights will be issued per stock

thus,

number of rights required for purchase

= ( stock outstanding ) ÷ ( Number shares to be issued  )

= 540,000 ÷ 260606.06

= 2.072 rights

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Answer: See attachment

Explanation:

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2 years ago
A broker desires to keep an escrow account in an interest bearing account. Would this be legal?
wolverine [178]

Answer:

the correct answer is YES

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g Jackson Industries uses a standard cost system in which direct materials inventory is carried at standard cost. Jackson has es
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