1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Viktor [21]
3 years ago
12

DRK, Inc., has just sold 110,000 shares in an initial public offering. The underwriter’s explicit fees were $66,000. The offerin

g price for the shares was $60, but immediately upon issue, the share price jumped to $66.00. a. What is the total cost to DRK of the equity issue?
Business
1 answer:
iris [78.8K]3 years ago
4 0

Answer: $726000

Explanation:

Based on the information given in the question, the total cost to DRK of the equity issue will be calculated thus:

Firstly, we'll calculate the implicit cost per share which will be:

= Increased price - Offering price

= $66 - $60

= $6

Then, the total implicit cost will be:

= $6 × 110000

= $660000

Then, the total cost to DRK of the equity issue will be:

= Explicit cost + Implicit cost

= $66000 + $660000

= $726000

You might be interested in
Which of the following is one way the Federal Reserve Bank serves the government?
Andrews [41]

Answer:

making loans to the government

3 0
2 years ago
Which one of the following types of charitable contributions is NOT deductible for federal income tax purposes?
Fofino [41]

Answer: B.

Explanation: Contributions to individuals, foreign governments, foreign charities, and certain private foundations similarly are not deductible.

3 0
3 years ago
Net Zero Products, a wholesaler of sustainable raw materials. Prepared the following aging of receivables analysis.
kkurt [141]

Answer:

Net Zero Products

a) The balance of the Allowance for Doubtful Accounts using the aging of accounts receivable method is $4,300.

b) Adjusting Entry to record bad debt expense:

Debit Bad Debt Expense $1,700

Credit Allowance for Doubtful Accounts $1,700

To record the bad debt expense for the period and bring the allowance to $4,300 credit balance.

Explanation:

a) Data and Calculations:

Aging of receivables analysis:

Total (days)                          0        1 to 30     31 to 60     61 to 90     above 90

Accounts receivable $171,000   $96,000   $34,000     $15,000     $12,000

Percent uncollectible                      1%            4%                 6%            9%

Allowance for doubtful     0          $960        $1,360         $900        $1,080

Total allowance for doubtful = $4,300 (960 + 1,360 + 900 + 1,080)

b) The adjustment in the Allowance for Doubtful Accounts needed for the current period is $1,700 ($4,300 - $2,600).  This amount will be debited to the Bad Debts Expense account and credited to the Allowance for Doubtful Accounts.  It will bring the total for the Allowance for Doubtful Accounts to $4,300 from $2,600.

3 0
3 years ago
If investors believe that a stock is not providing a return that sufficiently compensates them for the risk of the stock, they w
jarptica [38.1K]

Answer:

<u>sell the stock which will drive it's expected return even lower.</u>

Explanation:

An investor wants to be compensated for the risk undertaken in the form of return. When investors believe that a stock is not providing sufficient return, such stocks would be sold by the investor.

When a stock is not performing well i.e it's current market price goes down, all the investors holding that stock will sell it , leading to it's market price going further down.

Since the market price goes further down, the expected return on such a stock would further decline.

3 0
3 years ago
Essay about an private company​
il63 [147K]
You want us to write it for you lol?
8 0
3 years ago
Other questions:
  • Price fluctuations that are the result of special product promotions, quantity discounts, and other special pricing discounts by
    6·1 answer
  • ​Matthew's Fish Fry has a monthly target operating income of​ $6,600. Variable expenses are​ 80% of sales and monthly fixed expe
    13·1 answer
  • If management identifies even one material weakness in internal control, then management will conclude that the organization’s i
    9·1 answer
  • Which of the following conforms to the notion put forward by the school of thought associated with stage models? a. Natural reso
    12·1 answer
  • A former client of charlie hayes, cpa, filed a lawsuit in state court alleging that charlie failed to exercise due care in the p
    11·2 answers
  • The UCC requires that HDCs take instruments in good faith. This means that: a.the holders must have performed a special oath bef
    5·1 answer
  • An excise tax of $2 is placed on a jar of Honey. Honey producers end up bearing only $0.40 of the tax. The demand curve for hone
    5·1 answer
  • "After a severe hurricane in South Carolina, the price of electric generators quadrupled. People living outside of South Carolin
    11·2 answers
  • If shondra really wants to borrow alicia's shoes but she thinks she may refuse, the idea of the door-in-the-face technique state
    15·1 answer
  • According to Porter companies that wish to dominate broad markets should operate using a __________ strategy.
    10·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!