18-1 & 18-3 please

LEMS ANSWERS ARE IN APPENDIX B (18-1) r Loss on ock Issue EASY PROBLEMS 1-2 Beedles Inc. needed to raise $14 million in an IPO and chose Security Brokers Inc. to underwrite the offering. The agreement stated that Security Brokers would sell 3 million shares to the public and provide $14 million in net proceeds to Beedles. The out-of- pocket expenses incurred by Security Brokers in the design and distribution of the issue were $300,000. What profit or loss did Security Brokers incur if the issue were sold to the public at the following average price? a. $5 per share b. $6 per share c. $4 per share i pot saada te raica $20 million (18-3) Pricing Stock Issues INTERMEDIATE PROBLEMS 3-5 Benjamin Garcia's start-up business is succeeding, but he needs $200,000 in addition, funding to fund continued growth. Benjamin and an angel investor agree the business worth $800,000 and the angel has agreed to invest the $200,000 that is needed. Benjamin presently owns all 40,000 shares in his business. What is a fair price per share and how many additional shares must Benjamin sell to the angel? Because the stock will be sold directly to an investor, there is no spread; the other flotation costs are insignificant