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Nielson Motors sold 10 million shares of stock in an SEO.The market price of Nielson's stock at the time was $37.50.Of the 10 million shares sold,4 million shares were primary shares sold by the company,and the remaining 6 million shares were being sold by the venture capital investors.Assume the underwriter charges 4% of the gross proceeds as an underwriting fee which is shared proportionately between the primary and secondary shares.
-The amount of money the underwriter will earn on this transaction is closest to:
Carrying Value
The amount at which an asset is recognized in the balance sheet, subtracting any accumulated depreciation or amortization.
Maturity
The date on which a financial instrument or obligation becomes due and is to be paid or settled.
Face Value
The nominal value printed on a bond or stock certificate, representing its legal value.
Straight-Line Method
A depreciation technique that allocates an equal amount of depreciation expense for an asset over its useful life.
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