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Problem:

Raybac is about to go public. Its present stockholders own 500,000 shares. The new public issue will represent 800,000 shares. The shares will be priced at $25 to the public with a 4% spread. The out-of pocket costs will be $450,000.

Required:

Question: What are the net proceeds to the firm.

a) 18,750,000

b) 17,200,000

c) 18,250,000

d) 16,175,000

Note: Please provide step by step solution.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M91167858

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