Question

A firm has $3,600,000 in its common stock account and $36,000,000 in its paid in capital accountThe firm issued 450,000 shares of common stock. What was the issue price (market value) if only one stock issuance has occurred?

Answer 1

the issue price is $88 per share

Step-by-step explanation:

The computation of the issue price is shown below:

= (Common stock + paid in capital) ÷ (Number of common shares issued)

= ($3,600,000 + $36,000,000) ÷ 450,000 shares

= $39,600,000 ÷ 450,000 shares

= $88 per share

Hence, the issue price is $88 per share