Determine the book value of each outstanding share

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Reference no: EM133182676

Question - FullGuate S.A. has Q1,400,000 shares outstanding and Q100,000 shares in treasury. Each share has a par value of Q1,000. To date they have accumulated profits and reserves for Q3,850,000

Required -

1. If there were only one type of shares, determine the book value of each outstanding share.

2. Taking the same case data, if 20% of the authorized shares were preferred shares with a fixed preferred dividend of 10%. Of the treasury shares, 90% are common shares and the rest are preferred shares. Determine the book value of each type of share taking into account that preferred shares are cumulative (the dividend is paid with a delay of 2 years) without total participation.

3. What does the commercial code indicate about the treatment of treasury shares.

4. In the event that treasury shares are sold at a premium of 20% over their nominal value, indicate whether it would be above or below the book value that you determined for each type of share.

Reference no: EM133182676

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