Mountain Mining requires $3.3 million to expand its current operations and has decided to raise these funds through a rights offering at a subscription price of $18 a share. The current market price of the company's stock is $24.70 a share. How many shares of stock must be sold to fund the expansion plans? a. 140,015 sharesb. 118,943 sharesc. 126,667 sharesd. 135,000sharese. 105,689 shares

Question

Business

Dude

21 October, 20:21

Mountain Mining requires $3.3 million to expand its current operations and has decided to raise these funds through a rights offering at a subscription price of $18 a share. The current market price of the company's stock is $24.70 a share. How many shares of stock must be sold to fund the expansion plans? a. 140,015 sharesb. 118,943 sharesc. 126,667 sharesd. 135,000sharese. 105,689 shares

+5

Answers (1)

Know the Answer?

Josephine Calderon · Answer 1

183,333.33 shares

Explanation:

The computation of the shares of stock need to be sold is shown below:

= Total amount required to expand its current operations : subscription price

= $3,300,000 : $18 per share

= 183,333.33 shares

This is the answer and the same is not provided in the given options

We simply divide the Total amount required to expand its current operations by the subscription price so that the accurate shares can come.

All other information which is given is not relevant. Hence, ignored it