In my league, we charged $10 for an entry fee, and $1 for each add/drop up to 15 for the season. That means each owner's cap is $25 for entry and free agents. Also, trades were $1 per player involved in the trade, assuming that it should cost more to improve your team via trade.
All the money should be distributed to the top 25% of the teams. So, if there's 12 teams, first place gets half, and 2nd and 3rd split the other half, maybe 30-20.
LET'S GO METS!