Question

Required information

[The following information applies to the questions displayed below.]

Raphael Corporation’s common stock is currently selling on a stock exchange at $159 per share, and its current balance sheet shows the following stockholders’ equity section:

Preferred stock—5% cumulative, $___ par value, 1,000 shares authorized, issued, and outstanding	$	50,000
Common stock—$___ par value, 4,000 shares authorized, issued, and outstanding		200,000
Retained earnings		330,000
Total stockholders' equity	$	580,000

3. If no dividends are in arrears, what is the book value per share of common stock?

Required information

[The following information applies to the questions displayed below.]

Raphael Corporation’s common stock is currently selling on a stock exchange at $159 per share, and its current balance sheet shows the following stockholders’ equity section:

Preferred stock—5% cumulative, $___ par value, 1,000 shares authorized, issued, and outstanding	$	50,000
Common stock—$___ par value, 4,000 shares authorized, issued, and outstanding		200,000
Retained earnings		330,000
Total stockholders' equity	$	580,000

3. If no dividends are in arrears, what is the book value per share of common stock?

Required information

[The following information applies to the questions displayed below.]

Raphael Corporation’s common stock is currently selling on a stock exchange at $159 per share, and its current balance sheet shows the following stockholders’ equity section:

Preferred stock—5% cumulative, $___ par value, 1,000 shares authorized, issued, and outstanding	$	50,000
Common stock—$___ par value, 4,000 shares authorized, issued, and outstanding		200,000
Retained earnings		330,000
Total stockholders' equity	$	580,000

3. If no dividends are in arrears, what is the book value per share of common stock?

Answer 1

3)

book value per Preferred share

Choose Numerator

/

Choose Denominator

=

Book value per common share

stockholders equity applicable to PS

/

Number of PS outstanding

=

Book value per common share

50,000

/

1,000

=

50

book value per common share

Choose Numerator

/

Choose Denominator

=

Book value per common share

stockholders equity applicable to CS

/

Number of CS outstanding

=

Book value per common share

530,000

/

4,000

=

132.5

Explanation:

common stock

Book value of preferred stock=

par value

(when not callable)

Total Equity

(CS +RE)

580,000

less Equity for preferred

-50,000

common stock Equity

530,000

number of oustanding shares

4,000

book value per common share

132.5