Question

the question. 7. The Waverly Brush Company issued 4,000 shares of common stock worth $200,000.00 total. What is the par value of each share?

Answer 1

We are basically dividing 200,000 into 4,000 parts (imagine it being a massive pie, and chopping it into 4000 pieces - yes it would be a big pie :P)

So, we divide 200,000 by 4000
200000/4000

If doing this by hand, we can cancel 3 of the zeros immediately, giving us
200/4
Now we can write this as
100 lots of 2/4 = 100 lots of 1/2 = 0.5*100
And this gives us 50.

Therefore the value of each share is $50