A firm has a total assets of $8,000,000, that can be sold in the market today for $6,000,000. Total Liabilities of $4,000,000, preferred stock of $500,000, and 100,000 shares of common stock outstanding. Its book value per share will be? * (1 Point) $45 $35 $25 $55

Solution :-

Book value of Total asset = $8,000,000

Total liabilities = $4,000,000

Preferred Stock = $500,000

So, firstly we will calculate Book value of common stock :-

= Book value of Total assets - total liabilities - preferred stock

= $8,000,000 - $4,000,000 - $500,000

= $3,500,000

Number of shares of common stock outstanding = 100,000

Book value per share of common stock :-

= Book value of common stock / Number of shares outstanding

= $3,500,000 / 100,000

= $35

Answer :- $35