Hello,

I need help with the following question. I did my own calculations, but not sure if it is correct. Please, check my work and if it is incorrect, correct it with explanations.

A corporation has total stockholders equity of $4,628,000 and one class of $2 par value common stock. The corporation has 500,000 shares authorized: 300,000 shares issued and 40,000 shares as treasury stock. What is its book value per share? What is the number of outstanding shares?

Total Outstanding Shares = Issued Shares Shares as Treasury Stock

Total Outstanding Shares = 300,000 - 40,000= 260,000

Book Value Per Share = Total Shareholder Equity Preferred stock / Number of Common Shares Outstanding

Preferred stock is not known in this case, so I used commons tock shares instead. I am not sure if it is correct, but I dont know how to find out preferred stock.

Common stock= 300,000 shares*$2 par value= $600,000

4,628,000 $600,000 / 260,000 = 15.49 Per Share = Book Value