E129 a casha 300 preferredstockse 300

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Unformatted text preview: 20)] ÷ 685 Shares = $9.03 per Share f. Issuing stock can either increase or decrease the book value of a company's common stock. Whether issuing stock increases or decreases the book value depends upon the issue price of the new stock. If new stock is issued at a price above the pre­issue book value, then issuing the stock increases the book value. Alternatively, if new stock is issued at a price below the pre­issue book value, then issuing the stock decreases the book value. g. Purchasing treasury stock can either increase or decrease the book value of a company's common stock. Whether purchasing treasury stock increases or decreases the book value depends upon the acquisition price of the treasury stock. If treasury stock is acquired at a price above the pre­issue book value, then purchasing treasury stock decreases the book value. Alternatively, if treasury stock is acquired at a price below the pre­issue book value, then purchasing the stock increases the book value. E12–9 a. Cash (+A) 300 Preferred Stock (+SE) 300 Issued pr...
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