a. Calculate book value per share of common stock.

b. Assume that the company also had $1,000,000 worth of convertible bonds. The bonds are convertible at one $1,000 bond into 150 shares of stock. There are also stock options to buy 120,000 shares at a price of $5 per share. The stock is currently trading at $30 per share. Recalculate your answer to part a) taking into account dilutive effects of the above.

$1,000,000 230,000 Preferred stock - 100,000 shares authorized, issued and outstanding; $10 par value; $11 liquidation value Common stock, par value $0.50. Authorized 1,000,000 shares; issued - 460,000 shares Capital contributed in excess of par value Retained earnings Treasury stock, at cost (50,000 shares) Total stockholders' equity 4,750,000 (500,000) (500,000) $4,980,000