At year end, Rebos Company's financial statements showed sales of $820 million, net income of $425 million, total assets of $750 million, total liabilities (including preferred stock) of $735 million, and 1.20 million shares of common stock outstanding. Rebos has been offered $742.50 million to sell their assets. Based on this information, calculate the company's book value per share and liquidation value per share of common stock, respectively.

Question

Dale Stout

Business

10 October, 23:03

At year end, Rebos Company's financial statements showed sales of $820 million, net income of $425 million, total assets of $750 million, total liabilities (including preferred stock) of $735 million, and 1.20 million shares of common stock outstanding. Rebos has been offered $742.50 million to sell their assets. Based on this information, calculate the company's book value per share and liquidation value per share of common stock, respectively.

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Lizeth · Answer 1

total sales $820 million

net income $425 million

total assets $750 million

total liabilities $735

1.2 million outstanding common stocks

an offer was made to buy their assets at $742.5 million

company's book value per share:

= (total assets - total liabilities) / total number of outstanding common stocks

= ($750,000,000 - $735,000,000) / 1,200,000 = $12.50 per stock

company's liquidation value per share:

= (total offer - total liabilities) / total number of outstanding common stocks

= ($742,500,000 - $735,000,000) / 1,200,000 = $6.25 per stock