Answer:
Heya
Step-by-step explanation:
To calculate the cost for Chester Corporation to repurchase all its outstanding shares, we need to consider the brokerage fees, which total 1% of the underlying transaction.
Let's assume the total value of the outstanding shares is X dollars.
The brokerage fees would be 1% of X, which is 0.01 * X.
To find the total cost, we need to add the brokerage fees to the value of the outstanding shares:
Total cost = X + 0.01 * X
Factoring out X:
Total cost = (1 + 0.01) * X
Simplifying the expression:
Total cost = 1.01 * X
Based on the answer options provided, the closest value to 1.01 * X is $253.1 million.
Therefore, the cost for Chester Corporation to repurchase all its outstanding shares would be approximately $253.1 million.