Book Value Per Common Share Is Computed By

question 2

Multiple Choice

Book value per common share is computed by:

• A) Dividing the number of common shares outstanding by stockholders' equity applicable to common shares.
• B) Dividing total assets by the number of shares outstanding.
• C) Dividing stockholders' equity applicable to common shares by the number of common shares outstanding.
• D) Multiplying the number of common shares outstanding times the market price per common share.
• E) Multiplying the number of common shares outstanding by par value per share.

---

Definitions:

Loanable Funds

The money available for borrowing; the market wherein savers supply funds to borrowers, typically through financial intermediaries.

Interest Rates

The rate at which a borrower is charged interest for borrowing money from a lender.

Perpetuity

An annuity in which the periodic payments begin on a fixed date and continue indefinitely.

Long-Term Bonds

Debt securities with a maturity of more than 10 years, offering periodic interest payments.