Three friends decides to start a business. They obtained a licence costing $1m and did a feasibility study costing $10M.
They decided to raise equity through a loan of $100m and listing shares on the market. Each of them possess 500 shares and they decided to list 75% and keep 25%. They also possess capital expenditure of $235M and working capital is $41m.
How do I calulate value per share, should I do it based on total shares available in the Co. or the amount listed which is 75%?
I know that the amount for licence and feasibility is sunk but should be written off over 5 years should I charge the annual amount in the P&L account?
When preparing a cash flow should i include the loan amount as an inflow or only account for it in the B.S?
Thank you
Student
Student