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Roth Corp. wants to raise $4.6 million via a rights offering. The company currently has 560,000 shares of common stock outstanding that sell for $70 per share. Its underwriter has set a subscription price of $40 per share and will charge the company a spread of 2 percent.

If you currently own 2,500 shares of stock in the company and decide not to participate in the rights offering, how much money can you get by selling your rights? (Do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))
Subscription price $

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Jamar Ferry
Jamar FerryLv2
28 Sep 2019

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WUV Ltd. wants to raise $3.29 million via a rights offering. Thecompany currently has 420,000 shares of common stock outstandingthat sell for $30 per share. Its underwriter has set a subscriptionprice of $25 per share and will charge WUV a 6% spread. If youcurrently own 6,000 shares of stock in the company and decide notto participate in the rights offering, how much money can you getby selling your rights?

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Walker Machine Tools has 5.6 million shares of common stock outstanding. The current market price of Walker common stock is $54 per share rights-on. The company’s net income this year is $18.00 million. A rights offering has been announced in which 560,000 new shares will be sold at $48.50 per share. The subscription price plus four rights is needed to buy one of the new shares.


a. What are the earnings per share and price-earnings ratio before the new shares are sold via the rights offering? (Do not round intermediate calculations and round your answers to 2 decimal places.)

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