A. Marco Corporation has 6,000 shares of $100 par value, 8 percent cumulative preferred stock and 10,000 shares of $50 par value common stock outstanding. All shares were issued at par value. In addition, retained earnings total $198,000. If the preferred stock is callable at $105 per share and one year's dividends are in arrears, compute book value per share of preferred stock
b. Assume the same facts as in a above. Calculate book value per share of common stock.
c. Assume the same facts as in a above and that Marco Corporation declares a 15 percent stock dividend on its common stock. If the market value on the declaration date was $60 per share, for what amount will Additional Paid-in Capital, Common be credited?
d. Assume the same facts as in a above and that Marco Corporation declares a 4-for-1 stock split on its preferred stock. After the split, total par value of preferred stock equals what amount?
a. $113 per share ($100 x 0.08 = $8 + $105)
b. $62 per share [(6,000 x $100 ) + (10,000 x $50 ) + $198,000 = $1,298,000 - (6,000 x $113 ) = $620,000 รท 10,000]
c. $15,000 [10,000 x 0.15 = 1,500 x ($60 - $50)]
d. $600,000 (same as before, now 24,000 shares @ $25)
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