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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:

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:

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:

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

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

Explanation / Answer

The book value of the common stock of Raphael Corporations share:

=(Total stockholders equity- Preferred equity)/Number of common shares outstanding

=(580000-50000)/4000 shares=$132.5 per share

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