The Beranek Company, whose stock price is now $25, needs to raise $20 million in common stock. Underwriters have informed the firm?s management that they must price the new issue to the public at $22 per share because of signaling effects. The underwriters? compensation will be 5% of the issue price, so Beranek will net $20.90 per share. The firm will also incur expenses in the amount of $150,000. How many shares must the firm sell to net $20 million after underwriting and flotation expenses? Please fill the form under Chapter 20: Problem 2. Any other instructions or step by step on how the answer was made should be provided as well.

Unit 4 Problems: Submittions Template: Chapter 18th: Problem 2 Given Data Tax Rate: Depreciation per year: Lease Paument each year Bank Loan Rate: Step 1: Calculate the cost of owning ( Note: you will use the NPV forula in Excel) Rate (Discount Rate) Year 0 Year 1 Year 2 NPV (answer) Setp 2: Calculate the cost of leasing (Note: You will use the NVP formula in Excel) Rate(Discount Rate) Year 0 Year 1 NPV (answe) Shoulr Reymolds Lease or buy? Include an explanation of the pors and cons of leasing over ownership of an asset. Chapter 20- Problem 2 Given data: Stock Price Amount needed to raise Price of new Issue underwritters compensation: Beranek net per share: Berenek expenses: 25 20000000 22 5.00% 20.9 150000 (Note: input the correct data and use the appropriate formula in the answer cell) Answer Cell Include an explanation of a specific item, for example interes, floatation costs, call premium, of how to use refunding tools and techniques to minimizethe cost of capital