calculation of average issue price of stockthe

Question

Calculation of average issue price of stock.

The information below relates to Question No. 1

The stockholders' equity section of the balance sheet of Garson Fashions, Inc., at December 31, 2008 appears as follows:

Stockholders' equity:

7% preferred stock, $100 par, callable at $105. 50,000 shares authorized, 60,000 shares issued ...................	$6,000,000
Common stock, $2 par, 600,000 shares authorized, 400,000 shares issued, of which 30,000 are held in treasury ................................	800,000
Additional paid-in capital:
From issuance of preferred stock................................	680,000
From issuance of common stock .........................................................................	1,720,000
From treasury stock transactions .....................................................................	60,000
From common stock dividends ...........................................................................	400,000
Total paid-in capital ..........................................................................	$9,660,000
Retained earnings ($240,000 equal to cost of treasury stock is not available for dividends) ............................................................	2,400,000
$12,060,000
Less: Treasury stock (at cost 30,000 common shares) ........................................	(240,000)
Total stockholders' equity ......................................................................	$11,820,000

Answer the following question based on the stockholder's equity section given above. The company purchased no treasury stock before 2008. Please show your work to receive partial credit in the event that your final answer is incorrect.