Book value of each class of stock? A corporation reports the following stockhold
ID: 2417493 • Letter: B
Question
Book value of each class of stock?
A corporation reports the following stockholder’s equity as of December 31, 2008
Preferred stock, $50 par, 10% cumulative, 100,000
shares authorized and 90,000 shares issued $4,500,000
Paid-in capital in excess of par-common 945,000
Common stock, $10 par, 200,000 shares authorized
and 200,000 shares issued 2,000,000
Paid-in capital in excess of par-common 800,000
Total paid-in capital 8,245,000
Retained earnings 3,400,000
Total stockholder’s equity $11,645,000
No dividends were declared in 2007 and there were no dividends in arrears prior to 2007. What is the book value per share of each class of stock?
Explanation / Answer
Book value per share for preferred shares = (4,500,000 + 945,000 ) / 90000
= 60.5 per share
Book value per share for common stock = (2,000,000 + 800,000 + 3,400,000) / /200,000
= 6,200,000 / 200,000
= $ 31 per share
**Since in question there are 2 times for paid in capital -for common shares -it is not possible .so paid in capital in excess of par below preferred shares -is for preferred stock .