Equity (F7)

Question 1

Book Value Per Share

Answer 1

Preferred 250,000 + Common 350,000 + APIC 125,000 + RE 300,000
= 1,025,000 BV - 250,000 preferred - 50,000 premium - 25,000 div in arrears
=700,000 / 100,000 shares
= 7.00 per share

Question 2

Callable Preferred

Answer 2

500 shares of 100 par callable preferred called at 101 originally issued at 103

Pref Stock 50,000 (500100)
PIC 1,500 (500 * 103-100)
PIC - retirement 1,000 (500103-101)
Cash 50,500 (500 * 101)

Question 3

Treasury Stock

Answer 3

Reissued at less than cost = Debit Retained Earnings
Cash 360 (12 * 30)
RE     120
         T Stock 480 (16 * 30)
Reissued at more than cost
Cash 5000 (500 * 10-6)
          T Stock 3000 (500 * 6)
           APIC     2000

Question 4

Purchase T Stock

Answer 4

Original Issue
Cash 7
Common 6
APIC 1

Puchase T Stock
T Stock 6
APIC      1
RE          3
                  Cash 10

Question 5

Additional Shares Outstanding/Options/Dilutive EPS/Treasury Stock Method

Answer 5

2,000 options
Average price 50 per share
Exercise price 40 per share
2,000 - ((2,000 * 40) / 50) = 400