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10 5 learning objective 10 5 1 a book value per share of common stock is the same am 4298054

 

10.5   Learning Objective 10-5

 

1) A book value per share of common stock is the same amount as the market value per share.

 

2) In most cases, stockholders are more concerned about the par value of a stock than any other value.

 

3) The book value per share of common stock is the amount of owners' equity on the company's books for each share of its stock.

4) Book value per share of common stock is computed by dividing:

A) total paid-in capital by the number of common shares  of stock issued.

B) total paid-in capital by the number of common shares of stock outstanding.

C) total stockholders' equity by the number of common shares of stock issued.

D) total stockholders' equity by the number of common shares of stock outstanding.

 

5) The amount of owners' equity attributable to each share of stock is known as the:

A) earnings per share.

B) book value per share.

C) market value per share.

D) preferred value per share.

 

6) Preferred stock that requires the company to redeem the stock at a set price is called:

A) preferred stock.

B) convertible preferred stock.

C) redeemable preferred stock.

D) callable preferred stock.

 

7) On December 31, Arbor Corporation reports the following amounts in its Stockholders' Equity section:

 

Common Stock$4,000,000

Paid-in Capital in Excess of Par1,000,000

Retained Earnings4,125,000

Treasury Stock200,000

 

The common stock has a par value of $10 per share. One million shares of common stock are authorized and 50,000 shares are held in treasury stock.

 

Required:

Compute the book value per share of common stock.

 

8) On December 31, Greenwald Corporation had the following data available:

 

Net Income

$180,000

Interest expense

20,000

Preferred dividends

30,000

Total assets at the beginning of the year

860,000

Total assets at the end of the year

740,000

Total stockholders' equity at the beginning of the year

520,000

Total stockholders' equity at the end of the year

480,000

 

Calculate:

1.Return on Assets

2.Return on Equity

 

 

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