DLJones & Co

question 47

Multiple Choice

D.L.Jones & Co.recently went public.The firm received $20.80 a share on the entire offer of 25,000 shares.Keeser & Co.served as the underwriter and sold 23,700 shares to the public at an offer price of $22 a share.What type of underwriting was this?

• A)best efforts
• B)shelf
• C)over subscribed
• D)private placement
• E)firm commitment

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Definitions:

Absorption Costing

An accounting method that includes all manufacturing costs (direct materials, direct labor, and both variable and fixed overhead) in the cost of a product.

Fixed Costs

Costs that remain constant in total regardless of changes in the level of the business activity or production volume.

Product Costs

Costs that are directly associated with the production of goods or services, including direct materials, direct labor, and manufacturing overhead.

Traceable Fixed Expense

Expenses that can be directly linked to a specific department or segment of a business and would disappear if the department or segment was disbanded.