The yearend balance sheet of Columbus Products Irc includes

The year-end balance sheet of Columbus Products, Irc., includes the following stockholders\' equity section (with certain detals omitted) Stockholders equity Capital stock: Common stock, $5 par Conmon stock value, 5,eee, eee shares authorized, 3,688,008 shares issued and outstanding 18,,888 18,888,889 Additional paid-in capital Retained earnings 43,800,e8e 04,458. Total stockholders\' equity $143,450,889 From this irtformation, compute answers to the following questions a. How many shares of preferred stock have been issued? b. What is the total amount of the annual dividends to which preferred stockholders are enttled? c. What was the average issuance price per share of common stock? d. What is the amount of legal capital and the amount of total paid-in capita? lue per share of common stock, assuming no dividends in arrears? stockholders\' equity section above? f Is it possible to determine the fair market value per share of common stock from the Complete this question by entering your answers in the tabs below Required A Required B Required CRequired D Required E Required F

Solution

(a) How many shares of prefered stock have been issued Number of Sahres prefered stock issued =Total prefered stock capital / par value of per prefered Stock =$18,000,000/$100 =180,000 (b) Annual Dividend to the prefered stock holders are entitled Total Par value of prefered stcok =$18,000,000 rate on the Prefered stock=7% Prefered Dividend =$18,000,000*7% =$1,260,000 (c ) Average issuance price per share of common stock Total par value of Common stock=$18,000,000 Excess value over par =$43,000,000 Average Issue price per Common Stock =Issue proceeds / Number of Shares issued =($18,000,000+$43,000,000)/3600000 =$16.94 (d) Legal capital and amount of total paid In capital legal capital par value of prefered capital $18,000,000 par value of Common Stock Equity $18,000,000 Legal capital $36,000,000 Total Paid in capital legal capital $36,000,000 Additional paid In capital $43,000,000 Total Paid in capital $79,000,000 64450000 125450000 (e ) Book value per Share of Common Stock Total book value of Common Stock =par value of Common Stock + Additional paid in capital of common stock + retained earnings Total book value of Common Stock =$18000,000+$43000,000+$64,450,000 =$125,450,000 Number of Common stock Outstanding=3600,000 Book value per share of common stock =$125,450,000/3600,000 =$34.85