The following stockholders’ equity accounts arranged alphabetically are in the ledger of McGrath Corporation at December 31, 2011.
|
Common Stock ($10 stated value) |
$1,500,000 |
|
Paid in Capital from Treasury Stock |
6,000 |
|
Paid in Capital in Excess of Stated Value—Common Stock |
690,000 |
|
Paid in Capital in Excess of Par Value—Preferred Stock |
288,400 |
|
Preferred Stock (8%, $100 par, noncumulative) |
400,000 |
|
Retained Earnings |
776,000 |
|
Treasury Stock—Common (8,000 shares) |
88,000 |
Instructions
(a) Prepare a stockholders’ equity section at December 31, 2011.
(b) Compute the book value per share of the common stock, assuming the preferred stock has a call price of $110 per share.