Analyzing the stockholders’ equity section of the balance sheet The balance sheet of Ballcraft, Inc., reported the following:
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Preferred stock, $8 par, 5%, |
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4,000 shares authorized and issued |
$32,000 |
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Common stock, $2.50 par value, 41,000 shares authorized; |
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16,000 shares issued |
40,000 |
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Paid in capital in excess of par—common |
225,000 |
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Total paid in capital |
297,000 |
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Retained earnings |
40,000 |
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Total stockholders’ equity |
$337,000 |
Preferred dividends are in arrears for two years, including the current year. On the balance sheet date, the market value of the Ballcraft common stock was $31 per share.
Requirements
1. Is the preferred stock cumulative or noncumulative? How can you tell?
2. What is the total paid in capital of the company?
3. What was the total market value of the common stock?
4. Compute the book value per share of the common stock.