ABC Company is considering raising $12 million through a rights issue. It has 10 million ordinary shares

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ABC Company is considering raising $12 million through a rights issue. It has 10 million ordinary shares outstanding, currently selling for $840 each. The subscription price of new shares will be $6 per share.

a. How many shares must be sold to raise the desired funds?

b. How many shares must a shareholder own in order to have one right?

c. What is the theoretical value of the shares ex-rights?

d. What is the value of one right?

Related Book For answer-question

Accounting Information Systems

ISBN: 978-0133428537

13th edition

Authors: Marshall B. Romney, Paul J. Steinbart

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Posted Date: Jan 24, 2021 04:15 AM

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ABC Company is considering raising $12 million through a rights issue. It has 10 million ordinary shares

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Accounting Information Systems

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