QUESTION $7$

In calculating book value per common share:

the number of common shares issued is used as the denominator.

total shareholders equity plus prefered stock equity is used in the numerator. $*$

the average number of common shares outstanding is used in the denominator.

$$ total sharehoiders equity minus preferred stock equity is used in the numerator.

QUESTION $8$

Which of the following statements is true regarding current accounting for stock options?

No compensation expense is recognized unti stock options are exercised.

When recognizing stock option expense on the income statement, the equity method is used.

The stock option expense is recognized on the income statement on the grant date.

When recognizing stock option expense on the income statement, the fair value is used.

QUESTION $9$

Which of the following is a typical condition of receiving restricted stock?

If financial targets are not met, the employee never has to forfeit the restricted stock shares.

Awards are not usually linked to financial goals.

Employees can sell their shares on the grant date.

Employees may forfeit the shares if they leave the employer.