question archive PART B: EQUITY VALUATION 5
PART B: EQUITY VALUATION 5
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PART B: EQUITY VALUATION 5. At year-end, the Tangshan China Company balance sheet showed total assets of $60 million, total liabilities (including preferred stock) of $45 million, and 1,000,000 shares of common stock outstanding. Based on this information, Tangshan's book value per share of common stock is (5 marks)
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Book value per share = Total Common Equity divided by No. of common shares
Total Common Equity = Total Assets - Total Liabilities
Total Common Equity = $60 million - $45 million
Total Common Equity = $15 million
No. of common shares = 1 million
Book value per share = $15 million / 1 million = $15 per share
