Green Caterpillar Garden Supplies Inc. is a hypothetical company. Suppose it has the following balance sheet items reported at the end of its first and second years of operation.

Use the information given in the balance sheet to answer the question that follows.

Green Caterpillar Garden Supplies Inc.
Balance Sheet
Years ending December 31
	Year 2	Year 1
ASSETS
Current assets:
Cash and equivalents	$46,125	$36,900
Accounts receivables	$16,875	$13,500
Inventory	$49,500	$39,600
Total current assets	$112,500	$90,000
Net fixed assets:
Net plant and equipment	$137,500	$110,000
Total assets	$250,000	$200,000
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable	$0	$0
Accruals	$2,344	$0
Notes payable	$13,281	$12,500
Total current liabilities	$15,625	$12,500
Long-term bonds	$46,875	$37,500
Total debt	$62,500	$50,000
Common equity:
Common stock	$121,875	$97,500
Retained earnings	$65,625	$52,500
Total common equity	$187,500	$150,000
Total liabilities and equity	$250,000	$200,000

If Green Caterpillar Garden Supplies Inc. has 50 million shares of common stock outstanding, then the book value per share of Green Caterpillars stock in Year 2 was $3,750.

This statement is (correct or incorrect)? because:

The per-share book value is calculated by dividing the companys total common equity by the number of outstanding shares of common stock.

The per-share book value is calculated by dividing the companys total debt by the number of outstanding shares of common stock.

The per-share book value is calculated by dividing the companys total assets by the number of outstanding shares of common stock.