The stockholders' equity section of the balance sheet for Smile Corporation is shown below:
Paid-in capital:
Preferred stock, 7%, $50 par value, 10,000 shares authorized,
7,000 shares issued, redemption value $56 per share $350,000
Paid-in capital in excess of par value-preferred 50,000
Common stock, $10 par value, 50,000 shares authorized,
18,000 shares issued 180,000
Paid-in capital in excess of par value-common 20,000
Total paid-in capital $600,000
Retained earnings 300,000
Total paid-in capital $900,000
Assume there are 2 years' dividends in arrears on the preferred stock, including the current year. The book value per share for preferred stock is: (Must show work)
A) $57.00
B) $63.00
C) $60.50
D) $66.50
The book value per share for Smile's common stock is: (Must show work)
A) $27.83
B) $26.47
C) $25.50
D) $24.14