CHAPTER 16: PROBLEM 7 Stock Dividend 25% # of shares of stock outstanding 25,000
ID: 2736734 • Letter: C
Question
CHAPTER 16: PROBLEM 7 Stock Dividend 25% # of shares of stock outstanding 25,000 Market Value Balance Sheet: Cash $145,000 Fixed Assets $598,000 Total $743,000 Debt $127,000 Equity $616,000 Total $743,000 Find the market price of stock by using the equity and # of shares outstanding #NAME? New shares outstanding = #NAME? New Stock price = #NAME? CHAPTER 16: PROBLEM 7 Stock Dividend 25% # of shares of stock outstanding 25,000 Market Value Balance Sheet: Cash $145,000 Fixed Assets $598,000 Total $743,000 Debt $127,000 Equity $616,000 Total $743,000 Find the market price of stock by using the equity and # of shares outstanding #NAME? New shares outstanding = #NAME? New Stock price = #NAME?Explanation / Answer
1.Market Price of share = Equity Share Capital/No. of shares outstanding
Market Price of share = $616000/25000
Market Price of share = $24.64
2. New shares outstanding = 25000 + (25000*25%)
New shares outstanding = 31250
3. New Stock Price = $616000/31250
New Stock Price = 19.71