Calculating costs of issuing stock tristate corp. recently went public with an initial public offering in which they received a total of $51.60 million in new capital funding. the underwriter used a firm commitment offering in which the offer price was $34.00 and the underwriter's spread was $3.10. tristate also paid legal and other administrative costs of $1,110,000 for the ipo. what is the number of shares issued through this ipo?

1,705,825 shares

Explanation:

The computation of the number of shares issued through this IPO is shown below:

= (Total amount received + legal and other administrative costs) ÷ (Offer price - underwriter's spread)

= ($51,600,000 + $1,110,000) ÷ ($34 - $3.10)

= (52,710,000) ÷ ($30.9)

= 1,705,825 shares

Simply we take the total amount by considering the legal and other administrative costs and divide it by the offer price minus underwriter's spread so that the accurate amount can come.

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