a. Compute the book value of the common stock at December 31, 2025. (Round answers to 2 decimal places, e.g. 38.50.) Book value per share 1.79 b. Compute the book value of the common stock at December 31, 2025, assuming that the preferred stock has a liquidating value of $105 per share. (Round answers to 2 decimal places, e.g. 38.50) Book value per share 1.75
a. Compute the book value of the common stock at December 31, 2025. (Round answers to 2 decimal places, e.g. 38.50.) Book value per share 1.79 b. Compute the book value of the common stock at December 31, 2025, assuming that the preferred stock has a liquidating value of $105 per share. (Round answers to 2 decimal places, e.g. 38.50) Book value per share 1.75
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Windsor Inc. began operations in January 2023 and reported the following results for each of its 3 years of operations.
2023 $274,000 net loss
2024
44,000 net loss
880,000 net income
2025
At December 31, 2025, Windsor Inc. capital accounts were as follows.
8% cumulative preferred stock, par value $100; authorized, issued, and outstanding 5,100 shares
Common stock, par value $1.00; authorized 1,000,000 shares; issued and outstanding 702,000 shares
Windsor Inc. has never paid a cash or stock dividend. There has been no change in the capital accounts since Windsor began
operations. The state law permits dividends only from retained earnings.
a. Compute the book value of the common stock at December 31, 2025. (Round answers to 2 decimal places, e.g. 38.50.)
a. Compute the book value of the common stock at December 31, 2025. (Round answers to 2 decimal places, e.g. 38.50.)
Book value per share $
$510,000
$702,000
1.79
Book value per share i
b. Compute the book value of the common stock at December 31, 2025, assuming that the preferred stock has a liquidating value of
$105 per share. (Round answers to 2 decimal places, e.g. 38.50)
1.75
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