Case synopsis: Person MS and Person TS are discussing about the prospect of Company SS. The company seems to grow faster. However, the faster growth of the company is difficult to be financed by the company’s internal source. Thus, Person MS and Person TS have decided to go public and discuss about this with the Investment Bank CM. The underwriter of the Company was Person RH who assisted in the previous offerings of the company. The investment bank assisted many companies for their initial public offering, thus Person MS and Person TS are confident about the investment bank. The underwriter states the process that is taken by the investment bank. Characters in the case: Person MS Person TS Person RH Investment bank CM Company SS Adequate information: Person RH states to Person TS and MS that they must give their 3 years audited financial statements if they need to file with the securities exchange commission Person MS states that the company has given the financial statements that are audited as a part of the bond covenant The company makes a payment of $300,000 to the outside auditor To determine: The difference in the expenses to the Company SS if it utilize a Dutch auction initial public offering versus the traditional initial public offering. The company must go public through the traditional underwritten offering or through the Dutch auction.

Question

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Answer 1

Question

Chapter 15, Problem 1M

Summary Introduction

Case synopsis:

Person MS and Person TS are discussing about the prospect of Company SS. The company seems to grow faster. However, the faster growth of the company is difficult to be financed by the company’s internal source. Thus, Person MS and Person TS have decided to go public and discuss about this with the Investment Bank CM.

The underwriter of the Company was Person RH who assisted in the previous offerings of the company. The investment bank assisted many companies for their initial public offering, thus Person MS and Person TS are confident about the investment bank. The underwriter states the process that is taken by the investment bank.

Characters in the case:

Person MS

Person TS

Person RH

Investment bank CM

Company SS

Adequate information:

Person RH states to Person TS and MS that they must give their 3 years audited financial statements if they need to file with the securities exchange commission

Person MS states that the company has given the financial statements that are audited as a part of the bond covenant

The company makes a payment of $300,000 to the outside auditor

To determine: The difference in the expenses to the Company SS if it utilize a Dutch auction initial public offering versus the traditional initial public offering. The company must go public through the traditional underwritten offering or through the Dutch auction.

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Answer 2

Question

Chapter 15, Problem 1M

Summary Introduction

Case synopsis:

Person MS and Person TS are discussing about the prospect of Company SS. The company seems to grow faster. However, the faster growth of the company is difficult to be financed by the company’s internal source. Thus, Person MS and Person TS have decided to go public and discuss about this with the Investment Bank CM.

The underwriter of the Company was Person RH who assisted in the previous offerings of the company. The investment bank assisted many companies for their initial public offering, thus Person MS and Person TS are confident about the investment bank. The underwriter states the process that is taken by the investment bank.

Characters in the case:

Person MS

Person TS

Person RH

Investment bank CM

Company SS

Adequate information:

Person RH states to Person TS and MS that they must give their 3 years audited financial statements if they need to file with the securities exchange commission

Person MS states that the company has given the financial statements that are audited as a part of the bond covenant

The company makes a payment of $300,000 to the outside auditor

To determine: The difference in the expenses to the Company SS if it utilize a Dutch auction initial public offering versus the traditional initial public offering. The company must go public through the traditional underwritten offering or through the Dutch auction.

Expert Solution & Answer

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Answer 3

Question

Chapter 15, Problem 1M

Summary Introduction

Case synopsis:

Person MS and Person TS are discussing about the prospect of Company SS. The company seems to grow faster. However, the faster growth of the company is difficult to be financed by the company’s internal source. Thus, Person MS and Person TS have decided to go public and discuss about this with the Investment Bank CM.

The underwriter of the Company was Person RH who assisted in the previous offerings of the company. The investment bank assisted many companies for their initial public offering, thus Person MS and Person TS are confident about the investment bank. The underwriter states the process that is taken by the investment bank.

Characters in the case:

Person MS

Person TS

Person RH

Investment bank CM

Company SS

Adequate information:

Person RH states to Person TS and MS that they must give their 3 years audited financial statements if they need to file with the securities exchange commission

Person MS states that the company has given the financial statements that are audited as a part of the bond covenant

The company makes a payment of $300,000 to the outside auditor

To determine: The difference in the expenses to the Company SS if it utilize a Dutch auction initial public offering versus the traditional initial public offering. The company must go public through the traditional underwritten offering or through the Dutch auction.

Expert Solution & Answer

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Answer 4

Question

Chapter 15, Problem 1M

Summary Introduction

Case synopsis:

Person MS and Person TS are discussing about the prospect of Company SS. The company seems to grow faster. However, the faster growth of the company is difficult to be financed by the company’s internal source. Thus, Person MS and Person TS have decided to go public and discuss about this with the Investment Bank CM.

The underwriter of the Company was Person RH who assisted in the previous offerings of the company. The investment bank assisted many companies for their initial public offering, thus Person MS and Person TS are confident about the investment bank. The underwriter states the process that is taken by the investment bank.

Characters in the case:

Person MS

Person TS

Person RH

Investment bank CM

Company SS

Adequate information:

Person RH states to Person TS and MS that they must give their 3 years audited financial statements if they need to file with the securities exchange commission

Person MS states that the company has given the financial statements that are audited as a part of the bond covenant

The company makes a payment of $300,000 to the outside auditor

To determine: The difference in the expenses to the Company SS if it utilize a Dutch auction initial public offering versus the traditional initial public offering. The company must go public through the traditional underwritten offering or through the Dutch auction.

Expert Solution & Answer

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Answer 5

Chapter 15, Problem 1M

Summary Introduction

Case synopsis:

Person MS and Person TS are discussing about the prospect of Company SS. The company seems to grow faster. However, the faster growth of the company is difficult to be financed by the company’s internal source. Thus, Person MS and Person TS have decided to go public and discuss about this with the Investment Bank CM.

The underwriter of the Company was Person RH who assisted in the previous offerings of the company. The investment bank assisted many companies for their initial public offering, thus Person MS and Person TS are confident about the investment bank. The underwriter states the process that is taken by the investment bank.

Characters in the case:

Person MS

Person TS

Person RH

Investment bank CM

Company SS

Adequate information:

Person RH states to Person TS and MS that they must give their 3 years audited financial statements if they need to file with the securities exchange commission

Person MS states that the company has given the financial statements that are audited as a part of the bond covenant

The company makes a payment of $300,000 to the outside auditor

To determine: The difference in the expenses to the Company SS if it utilize a Dutch auction initial public offering versus the traditional initial public offering. The company must go public through the traditional underwritten offering or through the Dutch auction.

Answer 6

Chapter 15, Problem 1M

Summary Introduction

Case synopsis:

Person MS and Person TS are discussing about the prospect of Company SS. The company seems to grow faster. However, the faster growth of the company is difficult to be financed by the company’s internal source. Thus, Person MS and Person TS have decided to go public and discuss about this with the Investment Bank CM.

The underwriter of the Company was Person RH who assisted in the previous offerings of the company. The investment bank assisted many companies for their initial public offering, thus Person MS and Person TS are confident about the investment bank. The underwriter states the process that is taken by the investment bank.

Characters in the case:

Person MS

Person TS

Person RH

Investment bank CM

Company SS

Adequate information:

Person RH states to Person TS and MS that they must give their 3 years audited financial statements if they need to file with the securities exchange commission

Person MS states that the company has given the financial statements that are audited as a part of the bond covenant

The company makes a payment of $300,000 to the outside auditor

To determine: The difference in the expenses to the Company SS if it utilize a Dutch auction initial public offering versus the traditional initial public offering. The company must go public through the traditional underwritten offering or through the Dutch auction.

Answer 7

Chapter 15, Problem 1M

Summary Introduction

Case synopsis:

Person MS and Person TS are discussing about the prospect of Company SS. The company seems to grow faster. However, the faster growth of the company is difficult to be financed by the company’s internal source. Thus, Person MS and Person TS have decided to go public and discuss about this with the Investment Bank CM.

The underwriter of the Company was Person RH who assisted in the previous offerings of the company. The investment bank assisted many companies for their initial public offering, thus Person MS and Person TS are confident about the investment bank. The underwriter states the process that is taken by the investment bank.

Characters in the case:

Person MS

Person TS

Person RH

Investment bank CM

Company SS

Adequate information:

Person RH states to Person TS and MS that they must give their 3 years audited financial statements if they need to file with the securities exchange commission

Person MS states that the company has given the financial statements that are audited as a part of the bond covenant

The company makes a payment of $300,000 to the outside auditor

To determine: The difference in the expenses to the Company SS if it utilize a Dutch auction initial public offering versus the traditional initial public offering. The company must go public through the traditional underwritten offering or through the Dutch auction.

Answer 8

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Answer 9

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Answer 10

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Answer 11

Ch. 15.1 - Prob. 15.1ACQ Ch. 15.1 - Prob. 15.1BCQ Ch. 15.2 - What are the basic procedures in selling a new...Ch. 15.2 - What is a registration statement?Ch. 15.3 - Prob. 15.3ACQ Ch. 15.3 - Why is an initial public offering necessarily a...Ch. 15.4 - Prob. 15.4ACQ Ch. 15.4 - Prob. 15.4BCQ Ch. 15.5 - Prob. 15.5ACQ Ch. 15.5 - Suppose a stockbroker calls you up out of the blue...

Solution Summary: The author explains how Person MS and Person TS discuss the prospect of going public with the Investment Bank CM. The underwriter states the process that is taken by the investment bank.

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Chapter 15 Solutions