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What Are the Net Proceeds, Gross Proceeds and Underwriter's Spread

question 62

Essay

What are the net proceeds, gross proceeds and underwriter's spread? How does each affect the funds received by a public firm when debt or equity securities are issued?


Definitions:

Recoverable Amount

The higher value between an asset's fair value minus costs to sell and its value in use, used in assessing whether an asset is impaired.

Carrying Amount

The book value of an asset or liability on a company's balance sheet, reflecting its original cost adjusted for factors such as depreciation or amortization.

Anticipated Residual

The estimated value of an asset at the end of its useful life, taking into account depreciation and wear.

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