Assume Fisher Food Products is thinking about three different size offerings

Question # 00004909 Posted By: expert-mustang Updated on: 12/08/2013 03:16 AM Due on: 12/08/2013
Subject Accounting Topic Accounting Tutorials:
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Solution problem 8
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Question: Assume Fisher Food Products is thinking about three different size offerings for the issuance of additional shares.

Size of Order Public Price Net to Corporation
a. $ 1.6 million………. $40 $36.70
b. $ 6.0 million……… $40 $37.28
c. $25.0 million…….. $40 $38.12

What is the percentage underwriting spread for each size offer? What principle does this demonstrate?

Solution Problem 14
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Question: Winston Sporting Goods is considering a public offering of common stock. Its investment banker has informed the company that the retail price will be $18per share for 600,000 shares. The company will receive $16.50 per share and will incur $150,000 in regristration

a. What is the spread on this issue in percentage terms? What are the total expenses of the issue as a percentage of total value (at retail)? b. If the firm wanted to net $18 million from this issue, how many shares must be sold?

Solution problem 22 Show all calculations in excel file
Question: The management of Mitchell Labs decided to go private in 2002 by buying in all 3 million of its outstanding shares at $19.50 per share. By 2006, management had restructured the company by selling of the petroleum research division for #13

Because these divisions had been only marginally profitable, Mitchell Labs is a stronger company after the restructuring. Mitchell is now able to concentrate exclusively on contract research and will generate earnings nper
a. What was the initial cost of Mitchell Labs to go private?
b. What is the total value of the company from (1) the proceeds of the divisions that were sold, as well as (2) the current value of the 3 million shares(based on current earningsand a
c. What is the percentage return to the management of Mitchell Labs from the restructuring? Use answers from parts a and b to determine this value.

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Tutorials for this Question
  1. Tutorial # 00004700 Posted By: expert-mustang Posted on: 12/08/2013 03:23 AM
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    Assume_Fisher_Food_Products_is_thinking_about_three_different_size_offerings.xlsx (13.35 KB)

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