Bauer Software's Current Balance Sheet Shows Total Common Equity of $5,125,000.The

question 50

Multiple Choice

Bauer Software's current balance sheet shows total common equity of $5,125,000.The company has 300,000 shares of stock outstanding,and they sell at a price of $27.50 per share.By how much do the firm's market and book values per share differ? (Round your intermediate and final answer to two decimal places. )

• A) $13.02
• B) $12.71
• C) $12.92
• D) $10.42
• E) $9.38

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Definitions:

Stock Dividend

A stock dividend is a payment made in the form of additional shares instead of cash, reflecting a company's desire to reward shareholders without reducing cash on hand.

Par Value

The face value of a bond or stock as stated by the issuer, which may differ from its market value.

Capital in Excess

Funds received by a company over and above the par value of its stock, also known as additional paid-in capital.

Retained Earnings

Profits that a company has kept or retained rather than paid out as dividends to shareholders, often reinvested in the business.