The houston corp needs to raise money for an addition to, Ask an Expert

Finance

The Houston Corp. needs to raise money for an addition to its plant. It will issue 300,000 shares of new common stock. The new shares will be priced at $60 per share with an 8.5% spread on the offer price. Registration costs will be $150,000. Presently Houston Corp has earnings of $3 million and 750,000 shares outstanding. A). Compute the potential dilution from this new stock issue. B). Compute the net proceeds to Houston Corp. C). What rate of return must be earned on the net proceeds so that no dilution of earnings per share occurs?

View complete question

Basic Finance, Finance

Category:- Basic Finance
Reference No.:- M9858215

Have any Question?Write your Review or question?

Related Questions in Basic Finance

Grant technologies needs 300000 to pay its supplier grants

Grant Technologies needs $300,000 to pay its supplier. Grant's bank is offering a 210-day simple interest loan with a quoted interest rate of 11 percent and a 20 percent compensating balance requirement. Assuming there a ...

Please provide formula and explanation1 what is the

Please provide formula and explanation. 1. What is the accumulated sum of the following stream of payments?.$27,075 every year at the beginning of the year for 12 years, at 5.92 percent, compounded annually.

The following question was part of last years midtermdelta

The following question was part of last year's midterm: Delta Airlines and United Airlines are major American airlines with extensive international route networks. United has an enterprise value to EBIT (EV/EBIT) multipl ...

You have just arranged for a 1840000 mortgage to finance

You have just arranged for a $1,840,000 mortgage to finance the purchase of a large tract of land. The mortgage has an APR of 8.6 percent, and it calls for monthly payments over the next 25 years. However, the loan has a ...

The stock of business adventures sells for 65 a share its

The stock of Business Adventures sells for $65 a share. Its likely dividend payout and end-of-year price depend on the state of the economy by the end of the year as follows: Dividend Stock Price Boom $2.40 $73 Normal ec ...

1 there are three investments you are consideringinvestment

1. There are three investments you are considering: Investment 1: A saving account with an interest rate of 6% compounded daily. Investment 2: An investment fund guarantees it will pay 6.15% compounded annually. Investme ...

Answer as thorough as possible include an explanation of

Answer as thorough as possible, Include an explanation of your recommendations or trading strategies. Should you early exercise the following American-style put option? If not always, under what situation would you early ...

What are the differences between the federal deficit and

What are the differences between the Federal deficit and Federal Debt? How does a government budget deficit affect the economy, specifically the unemployment rate and job creation? Identify two periods in recent history ...

Abc company has projected sales of 1616 in january the

ABC Company has projected Sales of $1616 in January. The sales are expected to grow by 11% each month.ABC's collection schedule is as follows: ABC collects 28 percent of its sales in the month of sale and the remainder i ...

What effect would a change in the debt to equity ratio have

What effect would a change in the debt to equity ratio have on the weighted average cost of capital and the cost of equity capital of the firm?

4,153,160 Questions Asked
13,132 Experts
2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Recent Questions

Ask Basic Finance Expert