Ray Dolby started Dolby Laboratories and since then has been a leader in the entertainment industry and consumer electronics. Closely held since its founding in 1965, Dolby decided to go public. Here's an AP news report:

DOLBY'S IPO EXPECTED TO PLAY SWEET MUSICThe initial public offering market is hoping for a big bang this week from Dolby Laboratories Inc. The San Francisco company, whose sound systems and double-D logo are ubiquitous in the movie industry as well as in consumer electronics, plans to sell 27.5 million shares for $13.50 to $15.50 each, so it is safe to assume they would sell for an average of $14.50 each. Founded by Cambridge-trained scientist Ray Dolby 39 years ago, the company started out manufacturing noise-reduction equipment for the music industry that eliminated the background "hiss" on recordings, and has since expanded to encompass everything from digital audio systems to Dolby Surround sound. The company's IPO, which is lead-managed by underwriters Morgan Stanley and Goldman Sachs Group Inc., is expected to do well not only because of its brand recognition, but also because of its strong financials. (AP)

Required:

a.Assuming the shares are issued at the midpoint of the price range indicated, how much capital did the IPO raise for Dolby Laboratories before any underwriting discount and offering expenses? (Enter answer in millions and round to two decimal places)

b.If the par amount is $0.01 per share, what journal entry did Dolby use to record the sale? (Enter answer in millions or whole amounts. For example, if the answer is 10 million, enter as 10 or 10,000,000. If entering in millions, enter answer with three decimal places).

Enter answer in this column

a.

Amount raised in IPO

million

b.

Account Name

Debit

Credit

Cash (27.5 million shares x 14.50 each)

Common Stock (.01 per share x 27.5 million)

Paid in capital excess of par