The year-end balance sheet of Jackson Products, Inc., includes the following stockholders equity section (with certain details

Question:

The year-end balance sheet of Jackson Products, Inc., includes the following stockholders’ equity section (with certain details omitted):

Stockholders’ equity:

Capital stock:

7% cumulative preferred stock, $100 par value . . . . . . . . . . . . . . . . . . . . . . $ 15,000,000

Common stock, $5 par value, 5,000,000 shares

authorized, 4,000,000 shares issued and outstanding . . . . . . . . . . . . . . . 20,000,000

Additional paid-in capital:

Common stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44,000,000

Retained earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64,450,000

Total stockholders’ equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $143,450,000

From this information, compute answers to the following questions:

a. How many shares of preferred stock have been issued?

b. What is the total amount of the annual dividends to which preferred stockholders are entitled?

c. What was the average issuance price per share of common stock?

d. What is the amount of legal capital and the amount of total paid-in capital?

e. What is the book value per share of common stock?

f. Is it possible to determine the fair market value per share of common stock from the stock-holders’ equity section above? Explain.

Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on... Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial... Par Value
Par value is the face value of a bond. Par value is important for a bond or fixed-income instrument because it determines its maturity value as well as the dollar value of coupon payments. The market price of a bond may be above or below par,...