Problems pg. 785 : 18.1 (Profit or loss on New Stock Issue:)

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

Price to public: $5 per share

Number of shares: 3 million

Proceeds to Beedles: $14,000,000

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 the following average price?

a. $5 per share

b. $6 per share

c. $4 per share