Calculating Costs of Issuing Stock Computer Technology Corp

question 25

Multiple Choice

Calculating Costs of Issuing Stock Computer Technology Corp.recently went public with an initial public offering of 7 million shares of stock.The underwriter used a firm commitment offering in which the net proceeds was $8.35 per share and the underwriter's spread was 7 percent of the gross proceeds.Computer Technology also paid legal and other administrative costs of $300,000 for the IPO.Calculate the gross proceeds per share received by Computer Technology from the sale of the 7 million shares of stock.

• A)$8.35
• B)$8.39
• C)$8.98
• D)$9.02

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Definitions:

ALU

Arithmetic Logic Unit, a digital circuit used to perform arithmetic and logic operations that constitute the basis of all computer systems.

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