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Bauer Software's current balance sheet shows total common equity of $5,125,000. The company has 530,000 shares of stock outstanding, and they sell at a price of $27.50 per share. By how much do the firm's
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Bauer Software's current balance sheet shows total common equity of $5,125,000. The company has 530,000 shares of stock outstanding, and they sell at a price of $27.50 per share. By how much do the firm's market and book values per share differ?

User Letie
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1 Answer

3 votes

Answer:

The difference is $9,450,000

Step-by-step explanation:

Market Value of Share = $27.50 x 530,000

=$14,575,000

Book Value = $5,125,000.

Difference = $14,575,000- $5,125,000.

=$9,450,000

The market value is greater than book value by $9,450,000

User Blalasaadri
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5.3k points
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