Part A. Assuming a 1 round funding scenario, if an investor invests $5,000,000 at the beginning of year 1 (time 0) and requires a 20% return on his/her investment, what is the ownership percentage in the firm that the entrepreneur will want to give to the investor if the firm is sold at the projected amount in year 3? Please input your answer to two decimal places without the % sign and roundup (for example if answer is 10.56% input as .11) Part B. If there are 1,000,000 shares of stock outstanding before the first round of funding, how many shares of stock will be given to the investor in the first round of funding? Please input your answer in the xx,xxx format and round up to the nearest whole number. Part C. What is the price per share of the stock in the first round of funding? Please input your answer in the $xx.xx format and round up to the nearest cent
Part A. Assuming a 1 round funding scenario, if an investor invests $5,000,000 at the beginning of year 1 (time 0) and requires a 20% return on his/her investment, what is the ownership percentage in the firm that the entrepreneur will want to give to the investor if the firm is sold at the projected amount in year 3? Please input your answer to two decimal places without the % sign and roundup (for example if answer is 10.56% input as .11) Part B. If there are 1,000,000 shares of stock outstanding before the first round of funding, how many shares of stock will be given to the investor in the first round of funding? Please input your answer in the xx,xxx format and round up to the nearest whole number. Part C. What is the price per share of the stock in the first round of funding? Please input your answer in the $xx.xx format and round up to the nearest cent
Century 21 Accounting Multicolumn Journal
11th Edition
ISBN:9781337679503
Author:Gilbertson
Publisher:Gilbertson
Chapter17: Financial Statement Analysis
Section: Chapter Questions
Problem 4AP
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