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A company has 525 shares of $50 par value preferred stock outstanding, and the call price of its preferred stock is $61 per share. It also has 21,000 shares of common stock outstanding, and the total value of its stockholders' equity is $716,625. The company's book value per common share equals: $33.29.


$31.80.


$32.88.


$34.13.


$32.60.

Respuesta :

Answer:

$32.60

Explanation:

The formula and the computation is shown below:

Book value per share = (Total equity - preferred stock) ÷ (outstanding number of shares)

where,

Total equity is $716,625

Preferred stock would be

= 525 shares × $61

= $32,025

And, the outstanding number of shares is 21,000 shares

So, the book value per share would be

= ($716,625 - $32,025) ÷ (21,000 shares)

= ($684,600) ÷ (21,000 shares)

= $32.60

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