The following stockholders’ equity accounts arranged alphabetically are in the ledger of Rizzo Corporation at December 31, 2011.
|
Common Stock ($5 stated value) |
$2,500,000 |
|
Paid in Capital from Treasury Stock |
10,000 |
|
Paid in Capital in Excess of Stated Value—Common Stock |
1,600,000 |
|
Paid in Capital in Excess of Par Value—Preferred Stock |
679,000 |
|
Preferred Stock (8%, $50 par, noncumulative) |
800,000 |
|
Retained Earnings |
1,448,000 |
|
Treasury Stock—Common (10,000 shares) |
130,000 |
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 $60 per share.