Security Brokers Inc. specializes in underwriting new issues by small firms. On a recent offering of Beadles

Question:

Security Brokers Inc. specializes in underwriting new issues by small firms. On a recent offering of Beadles Inc., the terms were as follows:

The out-of-pocket expenses incurred by Security Brokers in the design and distribution of the issue were $300,000. What profit or loss would Security Brokers incur if the issue were sold to the public at an average price of?

a. $5 per share?

b. $6 per share?

c. $4 per share?

Distribution
The word "distribution" has several meanings in the financial world, most of them pertaining to the payment of assets from a fund, account, or individual security to an investor or beneficiary. Retirement account distributions are among the most...