Dixon Corporation is considering a public offering of common stock. The estimated selling price is $30 per share with Dixon Corp. receiving $26.25 per share after the offering. Out-of- pocket (additional) expenses are estimated at $275,000. Presently Dixon Corp has earnings of $5 million and 500,000 shares outstanding.

a) (3 points) What is the spread per share in dollars? In percent? b) (3 points) If Dixon corp needs to generate $28 million from this offering, what will be the required issuance amount in dollars? c) (3 points) How many shares will need to be sold to net their required $28 million? d) (3 points) What are the total expenses of the issue? e) (3 points) Compute the potential dilution in EPS from this new stock issue in the short- run?

f) (3 points) Show much additional earnings must be generated from this new issue for Dixon to return to their current EPS, assuming the new # of shares?