Sperle Corporation Has Provided the Following Data Concerning Its Stockholders

question 253

Multiple Choice

Sperle Corporation has provided the following data concerning its stockholders' equity accounts: Net income for Year 2 was $30,400. Dividends on common stock during Year 2 totaled $6,400. The market price of common stock at the end of Year 2 was $3.08 per share. The company's book value per share at the end of Year 2 is closest to:

• A)$0.38 per share
• B)$8.18 per share
• C)$18.08 per share
• D)$13.93 per share

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Definitions:

Outstanding Stock

Shares of a corporation that have been issued and are currently held by investors, including public shareholders and company insiders.

Consolidation Method

A method of accounting used to combine the financial statements of subsidiary companies with those of the parent company, presenting it as one economic entity.

Equity Method

An accounting technique used by firms to assess the profits earned by their investments in other companies, where the investment income is proportional to their ownership share.

Management's Intent

The plans and objectives that company management has regarding future operations, investments, or actions, which can affect financial reporting and decision-making.