At December 31, Gorden Corporation has total stockholders’ equity of $3,200,000. Included in this total are preferred stock $500,000 and paid-in capital in excess of par—preferred stock $50,000. There are 10,000 shares of $50 par value, 8% cumulative preferred stock outstanding. At year end, 200,000 shares of common stock are outstanding. Instructions Compute the book value per share of common stock under each of the following assumptions. a. There are no preferred dividends in arrears, and the preferred stock does not have a call price. b. Preferred dividends are one year in arrears, and the preferred stock has a call price of $60 per share.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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At December 31, Gorden Corporation has total stockholders’ equity of $3,200,000. Included in this total are preferred stock $500,000 and paid-in capital in excess of par—preferred stock $50,000. There are 10,000 shares of $50 par value, 8% cumulative preferred stock outstanding. At year end, 200,000 shares of common stock are outstanding. Instructions Compute the book value per share of common stock under each of the following assumptions. a. There are no preferred dividends in arrears, and the preferred stock does not have a call price. b. Preferred dividends are one year in arrears, and the preferred stock has a call price of $60 per share.
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