Three years​ ago, you founded Outdoor​ Recreation, Inc., a retailer specializing in the sale of equipment and clothing for recreational activities such as​ camping, skiing, and hiking. So​ far, your company has gone through three funding​ rounds:

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.

It is now

20232023

and you need to raise additional capital to expand your business. You have decided to take your firm public through an IPO. You would like to issue an additional

5.05.0

million new shares through this IPO. Assuming that your firm successfully completes its​ IPO, you forecast that

20232023

net income will be

​$7.57.5

million.

a. Your investment banker advises you that the prices of other recent IPOs have been set such that the​ P/E ratios based on

20232023

forecasted earnings average

19.619.6.

Assuming that your IPO is set at a price that implies a similar​ multiple, what will be your IPO price per​ share?

b. What percent of the firm will you own after the​ IPO?

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Part 1

a. Your investment banker advises you that the prices of other recent IPOs have been set such that the​ P/E ratios based on

20232023

forecasted earnings average

19.619.6.

Assuming that your IPO is set at a price that implies a similar​ multiple, what will be your IPO price per​ share?

The IPO price will be

​$enter your response here

per share.  ​(Round to the nearest​ cent.) Round Date Investor Shares Share Price ($)

Series A Feb. 2020 You 400,000 1.00

Series B Aug. 2021 Angels 1,300,000 1.00

Series C Sept. 2022 Venture Capital 2,200,000 2.50