Book Value Per Share and Other Computations
Shown Below Is

question 162

Essay

Book value per share and other computations
Shown below is information relating to the stockholders' equity of Silver Waste Management at December 31, 2009:
(a) White's total legal capital at December 31, 2009, is $_______________.
(b) The total amount of Silver's paid-in capital at December 31, 2009, is $________________.
(c) The average issue price per share of Silver's preferred stock was $_______.
(d) The book value per share of common stock is $_________ per share.
(e) The balance in Retained Earnings at the beginning of the year was $1,237,500, and net income for 2009 was $1,600,000. What was the amount of dividend declared on each share of common stock during 2007? $______ per share.
$$\begin{array} { | l | l | } \hline 8 \% \text { preferred stock, } \$ 150 \text { par, } 10,000 \text { shares } & \\\hline \text { authorized and } 6,000 \text { issued } & \$ 900,000 \\\hline \text { Common stock, } \$ 6.50 \text { par, } 500,000 \text { shares authorized } & \\400,000 \text { shares issued and outstanding } & \$ 2,600,000 \\\hline \text { Additional paid-in capital: preferred stock } & \$ 132,000 \\\hline \text { Additional paid in capital: common stock } & \$ 2,970,00 \\\hline \text { Retained earnings } & 0 \\\hline \text { (Assume there are no dividends in arrears) } & \$ 1,551,00 \\\hline\end{array}$$

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Definitions:

Present Value

The current worth of a future sum of money or stream of cash flows given a specified rate of return.

Interest Rate

The percentage charged by a lender to a borrower for the use of assets, reflecting the cost of borrowing money.

Future Payment

A payment that is scheduled to be made at a specified date in the future.

Interest Rate

The cost of borrowing money, usually expressed as a percentage of the amount borrowed.