Problem: The stockholders' equity section of the balance sheet for Atkins Company at December 31, 2007, is as follows:
Stockholders' Equity
Paid-in capital
Preferred Stock, ? Par Value, 6% cumulative,50,000
shares authorized, 30,000 shares issued
and outstanding $300,000
Common Stock, $10 ststed value, 150,000 shares
authorized, 50,000 shares issued and ?
outstanding 500,000
Paid-in capital in excess of par-preferred 30,000
Paid-in capital in excess of stated value-common 200,000
Total paid-in capital $1,030,000
Retained Earnings 250,000
Treasury Stock, 1,000 shares (100,000)
Total stockholders' equity $1,180,000
Required
Q1. What is the par value per share of the preferred stock?
Q2. What is the dividend per share on the preferred stock?
Q3. What is the number of common stock shares outstanding?
Q4. What was the average issue price per share (price for which the price was issued) of the common stock?
Q5. Explain the difference between the average issue price and the market price of the common stock.
Q6. If Atkins declared a 2-for-1 stock split on the common stock, how many shares would be outstanding after the split? What amount would be transferred from the retained earnings account because of the split? Theoretically, what would be the market price of the common stock immediately after the stock split?