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Norma-Jean [14]
3 years ago
13

DRK, Inc., has just sold 100,000 shares in an initial public offering. The underwriter’s explicit fees were $60,000. The offerin

g price for the shares was $40, but immediately upon issue, the share price jumped to $44. a. What is the total cost to DRK of the equity issue?
Business
1 answer:
MAVERICK [17]3 years ago
4 0

Answer:

$460,000

Explanation:

Data provided in the question

Number of shares sold = 100,000 shares

Explicit fees = $60,000

Offering price = $40

And, the increased share price = $44

Now the total cost of the equity issue is

= Number of shares sold × offering price per share + underwriter explicit fees

= 100,000 shares × $40 + $60,000

= $400,000 + $60,000

= $460,000

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The shape of a production possibility curve is downward-sloping because ____________________. Select the correct answer below: y
Afina-wow [57]

Answer:

you can get more of one good only by giving up some of another good

Explanation:

A production possibilities frontier shows the opportunity cost of producing one good instead of another. This way, as you follow the curve, the combination of goods will vary, increasing the production of one good but deceasing the production of the other.

Opportunity costs are the benefits lost or extra costs associated to choosing one activity or investment over another alternative. Since resources are scarce, you must always give something up in order to obtain another thing, e.g. you give up your leisure time in order to study.

8 0
3 years ago
On January 1, a company purchased a five-year insurance policy for $3,300 with coverage starting immediately. If the purchase wa
marissa [1.9K]

Answer:

a. Debit Insurance Expense. $660, credit Prepaid Insurance, $660.

Explanation:

The adjusting entry is shown below:

Insurance expense Dr $660 ($3,300 ÷ 5 years)

          To Prepaid insurance

(Being the insurance expense is recorded)

here we debited the insurance expense as it increased the expense and credited the prepaid insurance as it decreased the assets

Therefore the option a is correct

7 0
3 years ago
Lew just purchased $67,600 of equipment that is classified as 5-year MACRS property. The MACRS rates are 20 percent, 32 percent,
Nat2105 [25]

Answer:

The book value of this equipment at the end of four years if he ignores bonus depreciation $26,290.

Explanation:

Cost of property = $67,600

                           Balance    Depreciation

Year 1                  67,600         13520

Year 2                 54,080         17,306

Year 3                 36,774          7,061

Year 4                  29,713          3,423

Book vaue at the end of year 4 = 29,713 - 3423 = $26,290

6 0
3 years ago
Exxon's response to the 1989 Valdez tanker oil spill in Alaska is an excellent example of a company using thoughtful crisis mana
PilotLPTM [1.2K]

Answer:

Exxon's response worsened its public standing.

Explanation:

Crisis management is the application of game plan to help an organization deal with a sudden and significant negative event.

The Exxon's response is a perfect example of how company should apply thoughtful response in crisis management because Exxon corporation failed to follow several well-established procedures thereby damaged its public standing, failed to seize control of developments after the spill and sending lower-ranking executive to address the situation instead of the chairman going there himself to take control of  the situation in a possible way.

The action taken by Exxon led to the impression that the company disregard pollution problem by not involving top management.

6 0
3 years ago
Joshua borrowed $1,400 for one year and paid $70 in interest. The bank charged him a service charge of $12. If Joshua repaid the
Katen [24]

Answer: 10.81%

Explanation:

The annual percentage rate is the percentage cost of credit on yearly basis.

APR will be calculated

= [(2 x n x I) /( P x ( N + 1)]

where,

n = number of months = 12

I = Finance cost = Interest + service charge = $70 + $12 = $82

P = Borrowed amount = $1,400

N= Loan period = 12

We'll then slot the values into the annual percentage rate (APR) formula and this will be:

= ( 2 x n x I) /( P x ( N + 1))

= ( 2 x 12 x 82) /( 1400 x ( 12 + 1))

= 0.1081

=10.81 %

5 0
3 years ago
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