The following data are provided: December 31, 2018 2017 $106000 $106000 140000 9

Question

The following data are provided:

December 31,

2018

2017

$106000

$106000

140000

95000

76000

66000

254000

210000

50000

Additional information:
On May 1, 2018, 5000 shares of common stock were issued. The preferred dividends were not declared during 2018. The market price of the common stock was $40 at December 31, 2018.

The book value per share of common stock at 12/31/18 is calculated as (Which option below.):

216000 ÷ 14000.

December 31,

2018

2017

5% Cumulative preferred stock, $50 par

$106000

$106000

Common stock, $10 par

140000

95000

Additional paid-in capital

76000

66000

Retained earnings (includes current year net income)

254000

210000

Net income

50000

Explanation / Answer

Annual preferred dividends=106000*5%= $5300 Total common stockholders' equity=(140000+76000+254000)-5300= $464700 Option a 464700 ÷ 14000 is correct

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