2015. Sury stock f a. Prepare the stockholders' equity section of the balance sheet for Herndon Industnes 10,000 shares of this still held in treasury at December 31,20is. in capital on treasury stock and (2) retained earnings at the balance shiest d Diyidends are not increases paid on shares of stock held in treasury.) 31, 2015. Include supporting schedules showing () your computat retained earnings, vt of any pai whereas dividends reduce retained earnings. Dividends are not b. As of December 31, compute Herndon's book value per share of common stoc . At December 31, 2015, shares of the company's common stock were tradt n . (Hint: Book at $30. Expta common stock end value per share is computed only on the shares of stock outstanding.) what would have happened to the market price per share had the company at this date. Also explain what would have happened to the par to the number of common shares outstanding d rather aplit its stack 3-1 ere any Problem Set B connect h LOII-6 Early in 2012, Searfoss, Inc., was organizea with ion to issuc 2,0-30 shares of $100 par 01-4 through value preferred stock and 300,000 s t $1 per vatue common stock. Five hundred shaics sf 11.1B Equity in a the pr the preferred stock were issued at par, and 80,000 shares of commion stock were sold at Si5 pet share. The preferred stock pays a 10 pereent Equity in a cumulative dividend. During the first four years of operations (2012 through 2015), the corporation earned a total o $1,950,000 and paid dividends of 40 cents per share in each year on its outstanding common Instructions a. Prepare the stockholders' sance Sheet equity section of the balance sheet at December 31, 2015. Include computation of the amount of retained earnings a supporting schedule showing your reported. Assume the call price of preferred stock is $110 per share as of December 31, 2015. (Hint: Income increases retained earnings, whereas dividends decrease retained carnings.) Are there any dividends in arrears on the company's preferred stock at December 31, 2015? Explain your answer. Assume that interest rates increase steadily from 2012 through 2015. Would you expect the market price of the company's preferred stock to be higher or lower than its call price of S110 at December 21, 2015? (The call price is the amount the company must pay to repurchase the shares from the stockholders.) b. c