Ordinary shareholders' equity is obtained by deducting from total shareholders' equitythe preference shareholders' equity. The book value per share of the ordinary shares iscomputed by dividing the ordinary shareholders' equity by the number of ordinaryshares outstanding.illustration. Roberto D. Gonzales AdMark, Inc. is one of the leading firms doing highlycreative tri-media product exposures in Metro Manila and Calabarzon. Theshareholders' equity section of the statement of financial position is as follows:6% Cumulative Non-participating Preference Shares,P1,000 par, 5,000 shares authorized, 400 shares issuedand outstandingOrdinary Shares, P100 par, 20,000 shares authorized,5,500 shares issued and outstandingShare Premium-PreferenceP400,000.00P550,000.0040,000720,000Share Premium-OrdinaryRetained EarningsTotal Shareholders' Equity850,000P2,560,000.00Suppose that the preference shares has a liquidation value of P1,300 and dividends areIn arrears for three years. compute for the book value per share for both preference and ordinaryAssume that the company earns 150K with 1year arrear on dividend for preferred sharehow much is the correspondng earning for each type of shares?

Book value per share (BVPS) is the ratio of equity available to ordinary shareholders is divided by…

Answered: Suppose that the preference shares has…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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North Side Corp’s dividends for year 1, year 2, year 3, and expected share price for year 3 are: D1=$1.95, D2=$2.10, D3=$2.18, and P3=$95 respectively. What is the company’s current share price given the required return of 8 percent?
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Suppose that the preference shares has a liquidation value of P1,300 and dividends are n arrears for three years. compute for the book value per share for both preference and ordinary