At December 31, the stockholders' equity of Smith Company was as follow: Common stock, $5 par value: 1,100,000 shares issued $$\begin{array} { l r }
\text { and 1,000,000 shares outstanding } & \$ 5,500,000 \
\text { Additional paid-in capital } & 1,400,000 \
\text { Retained earnings } & 1,500,000 \
\text { Treasury stock, (100,000 shares) } &\underline{ ( 700,000 )} \
\text { Total stockholders' equity } &\underline{ \$ 7,700,000}
\end{array}$$ The book value per share of common stock is

Question

At December 31, the stockholders' equity of Smith Company was as follow: Common stock, $5 par value: 1,100,000 shares issued $$\begin{array} { l r } 
\text { and 1,000,000 shares outstanding } & \$ 5,500,000 \
\text { Additional paid-in capital } & 1,400,000 \
\text { Retained earnings } & 1,500,000 \
\text { Treasury stock, (100,000 shares) } &\underline{ ( 700,000 )} \
 \text { Total stockholders' equity } &\underline{ \$ 7,700,000}
\end{array}$$ The book value per share of common stock is

Quizplus · Accepted Answer

The book value per share of common stock is calculated by dividing the total stockholders' equity by the number of shares outstanding. In this case, the total stockholders' equity is $7,700,000 and the number of shares outstanding is 1,000,000. Therefore, the book value per share of common stock is $7.70.

At December 31, the Stockholders' Equity of Smith Company Was