Question
Telecom's financial statements as of December 31, 2019 included the following. Preferred Stock - 100,000 shares authorized, issued and outstanding. $10 par value. $1,000,000 Common
Telecom's financial statements as of December 31, 2019 included the following.
Preferred Stock - 100,000 shares authorized, issued and outstanding. $10 par value. $1,000,000
Common stock, par value $0.50. Authorized 1,000,000 shares; ??
issued 460,000 shares; outstanding 410,000 shares
Capital contributed in excess of par value - Common stock 4,750,000
Retained earnings (500,000)
Treasury stock, at cost (??? Shares at $10.00 each) ???
Total stockholders' equity ???
a. Calculate:
1. Common stock amount
2. Number of shares in treasury stock
3. Treasury stock amount
4. Total stockholders' equity
b. Calculate book value per share of common stock.
c. 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.
Calculate book value per share of common stock taking into account dilutive effects of the above.
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