At December 31,2010,the Book Value Per Share of Common Stock

Question 166

At December 31,2010,the book value per share of common stock of Big Time Corporation amounted to $21 per share.Determine the effect of each of the following items on the book value per share of common stock computation assuming each item occurs after December 31,2010.Consider each item independently of the other items listed.Indicate your answer for each (I = increase,D = decrease,or NE = no effect)in the appropriate blank. _____ 1.Sale of newly issued shares of common stock at $23 per share _____ 2.Purchase of treasury stock for $16 per share _____ 3.Declaration of current cash dividends on preferred stock _____ 4.Declaration and distribution of stock dividends on common stock _____ 5.Sale of treasury stock (purchased at $16 per share)for $19 per share _____ 6.Entry to close net income for the period to the Retained Earnings account _____ 7.Dividends in arrears on preferred stock _____ 8.Purchase of a truck with cash _____ 9.Payment of a previously declared and recorded cash dividend on common stock